Sunbulah Group in talks to buy food factories, logistics firms; eyes IPO of some units: chairman

Samer Kurdi, Chairman of Sunbulah Group

Sunbulah Group is in talks with a number of food factories and logistics services providers for full or partial acquisition, chairman Samer Ibrahim Kurdi told Argaam in an exclusive.

Kurdi added that the group is targeting acquisitions in the Kingdom, Europe, Asia and North America.

The group was incorporated in 1980 with SAR 2 million capital. Sunbulah focuses on the food industries that depend on wheat as a basic component for its bakery products. The group’s choice came amid the strong momentum witnessed in the 1970s amid plans to achieve self-sufficiency in wheat growing and wheat products in the Kingdom - an investment opportunity which was seized by the group to offer value-added products.

Over 40 years, the group was restructured and its operations were developed to include seven business activities in the food industries, namely manufacturing, distribution, creating trademarks, catering services, logistics services, retail, and leading projects. Since early 2011, Sunbulah was transformed from a limited liability company (LLC) to a closed shareholding company with a considerable number of shareholders and over 1,000 employees currently, Kurdi explained.

Sunbulah owns 12 units, where its stakes range between 30% and 100%. The group owns over 50% in the majority of these units.

Moreover, the group owns three industrial complexes, which are the largest in Jeddah, in addition to some factories in Egypt.

Sunbulah does not own any agricultural land, as part of its strategy, Kurdi noted, adding that the agricultural business is different from Sunbulah’s operations that begin after crop cultivation. Sunbulah provides raw materials through its links with various agricultural networks and suppliers.

“We deem ourselves an enabler of food industries in the Kingdom, which enhance our added value. We also targeted exports since the beginning, as Sunbulah products are distributed across 50 countries in the world,” Kurdi affirmed.

“The frozen bakeries is our most important segment, as it places Sunbulah not only among the world’s top 10 players but also on top of the Arab world in food industries. Al-Shifa Honey also ranks among the world’s top brands,” he noted, adding that the product’s market share exceeds 50% in more than 25 countries.

“Sunbulah is also deemed the first trademark in frozen vegetables sector in the Kingdom, GCC and Jordan,” Kurdi highlighted.

The chairman also indicated that the annual production capacity of the bakeries segment exceed 30,000 tons, honey (15,000 tons), vegetables of various types (more than 60,000 tons), meat and poultry – the group's smallest segment (more than 40,000 tons).

Sunbulah will launch operations in the retail segment after nearly one month. It plans to inaugurate four new projects in that sector within the coming 12 months.

Replying to a question about the potential public offering of the group, Kurdi said, "We currently do not have any plans for converting into a public joint-stock company. However, we have plans to float a number of units in the stock market within 2-3 years. The plan is backed by the nature of those units, as we believe that presence in the equity market will spur growth."

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