By Abdel Qader Ramadan
Saudi-owned company Beyti has announced it intends to pump EGP 4bn in new investments to Egypt to establish a new juice plant and two milk farms.
Beyti is a subsidiary of the International Company for Dairy and Juice, 52% owned by the Saudi Arabian company Almarai and 48% owned by Pepsico.
Abdul Rahman Abdul Mohsen Al-Fadly, CEO of Almarai, said in a press conference Sunday the company has developed the 5-year plan to expand operations.
The press conference was also attended by Minister of Industry and Trade Mounir Fakhry Abdel Nour.
“The plan includes the expansion of the company’s existing factory in addition to establishing a new plant for juices, a midsize farm with 5,000 cows for milk, and another major 20,000 cow milk farm, which would be the largest in Egypt and will come include EGP 1.5bn in investments,” said Al-Fadly.
The investments come in light of Saudi support for the Egyptian government following the 30 June ouster of former President Mohamed Morsi.
“The company’s board approved the first phase of the plan for investments of EGP 2.5bn,” said Al-Fadly. He added that establishing the milk farm depends on the Egyptian government providing a plot of land suitable to implement the project.
He said the company’s investment comes as part of plans to expand in the Egyptian market and to expand the company’s share of exports, especially to African countries.
“The Egyptian market is promising for investment opportunities and Almarai has achieved significant growth in its operations since acquiring, along with Pepsico, Beyti, which allowed it to increase revenues by 38% per year since 2009,” said Al-Fadly, “And this is what is now prompting the company to invest even more.”
Mohamed Badran, CEO of Beyti, said that Almarai has pumped EGP 1.25bn into Egypt since acquiring Beyti.
In a statement, the company said that “despite the [difficult] conditions facing the Egyptian economy,” they have pumped investments of nearly EGP 250m. This has been in the form of a capital increase in the fourth quarter of 2012 and the first quarter of 2013.
Badran said the new investments include an increase to the company’s shipping fleet, and the establishment of several distribution centres. The new centres ensure comprehensive coverage of the company’s products across the country.
“The new investments increase dependency on local production in the dairy sector and decrease milk imports while providing 4,000 direct job opportunities and 25,000 indirect job opportunities,” said Badran.
Badran explained that while Beyti achieved sales of EGP 4bn in 2009, it currently earns 5 to 6 times this amount. He added that production capacity is currently 3 times what it was two years ago.
“We aim to increase sales by 4 times the current value by the end of the current five-year plan,” said Badran.
He said the company currently has 20% of market share in terms of juices, dairy, and yogurts, and that the company’s five-year plan aims to push this number to 35%.