Olam Group, a Singapore multinational company is exploring the sale of its agricultural products business and could push back plans to list its food ingredients unit as it awaits better market conditions.
Olam Group is in initial talks to sell its entire 64.57 percent stake in Olam Agri to the state-run Saudi Agricultural and Livestock Investment Company (SALIC), WSJ reports.
If the sale goes through, the Singapore-listed group could drop its plans to list Olam Agri on the Saudi Exchange, according to the report.
SALIC, the report said, acquired a 35.43 percent stake in Olam Agri in 2022 for $1.24 billion putting the business’s equity value at $3.5 billion.
SALIC is wholly owned by Saudi Arabia’s Public Investment Fund, which has its investments primarily in the agricultural sector, and it is also active in agriculture, meat, and poultry.
As part of a reorganisation, Olam Group announced plans in 2021 to dual-list the Olam Food Ingredients business on the London and Singapore stock exchanges.
However, experts said the initial public offering (IPO) will likely be pushed to next year as market conditions remain volatile.
“The IPO of Olam Food Ingredients was estimated at over £1.0 billion,” experts said.
“Olam Group, SALIC, and Saudi Public Investment Fund did not immediately respond to mail seeking comment,” they added.
In February, Olam Group said that it ‘remains committed to listing both the food ingredients and agri units. It added that it will retain flexibility on the listing sequence, as well as explore other strategic options to unlock value.
Olam Food Ingredients is a food ingredients supplier selling cocoa, coffee, nuts, spices, and dairy products to various companies in the food and beverage industry.
It operates in around 50 countries across America, Africa, Europe, and Asia, with over 120 manufacturing facilities.
In 2023, it pulled in more than $11.5 billion in revenue. Olam Agri supplies grains and oilseeds, animal feed and protein, rice, edible oils, specialty grains and seeds, cottonwood products, rubber, and commodity financial services.
It has operations in over 30 countries, and its revenue in 2023 topped $23 billion, according to a WSJ report.
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