(Bloomberg) -- Brazilian chicken exporter BRF SA is expanding operations in Saudi Arabia in a deal designed to help the kingdom meet its goal of securing a locally produced food supply.
BRF Arabia, a joint venture with Saudi Public Investment Fund, said Thursday it is investing 316.2 million Saudi ryals ($84.3 million) to buy a 26% stake in Addoha Poultry Co., one of country’s top-10 chicken suppliers. The investment marks BRF’s entry into chicken production in the reign.
The investment underscores Saudi Arabia’s reliance on the Brazilian food giant to achieve its goal of getting 80% of chicken produced locally by 2030, from about 70% currently. The deal also is seen as helping BRF expand its presence in the larger Middle East market.
Of the total investment, almost $58 million will be set aside for expansion of both chicken production and industrial plants as existing facilities are operating at near full capacity, Igor Marti, vice president for Halal Market at BRF, said in an interview.
The investment fund’s affiliate, Saudi Agricultural and Livestock Investment Co., is the second largest BRF shareholder, owning 11% of the company’s shares.
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