In a move to solidify its presence in the UAE's agricultural sector, Ghitha Holding, a subsidiary of the massive Abu Dhabi-based conglomerate International Holding Company (IHC), has acquired an additional 12% stake in Al Ain Farms for Livestock Production. The deal, valued at AED 61 million (roughly $16.6 million), was announced on Friday through a filing on the Abu Dhabi Securities Exchange (ADX).
This acquisition is being executed through Was Commercial Investment, a subsidiary of Ghitha Holding. With this purchase, Was Commercial's total ownership in Al Ain Farms now surpasses 60%. Previously, as per a document filed on the ADX in July 2023, the Ghitha unit held a 51% stake in the livestock producer.
Ghitha Holding, primarily a trading and distribution firm, has been steadily expanding its portfolio within the IHC group. The company oversees a diverse range of subsidiaries, including Al Ajban Poultry, Alliance Food Company, Zee Stores International, Royal Horizon, and Al Jaraf Fisheries. Through these ventures, Ghitha deals with a vast array of products exceeding 10,000, with imports originating from countries like the US, Thailand, Brazil, Saudi Arabia, and Oman.
Al Ain Farms, on the other hand, specializes in livestock production, catering to the growing demand for meat products within the UAE. The increased investment from Ghitha Holding suggests a strategic intent to potentially leverage Al Ain Farms' production capabilities to bolster Ghitha's existing food distribution network. This integration could potentially create a more streamlined supply chain within the IHC group, ensuring greater control over product quality and potentially influencing market prices.
Analysts suggest that this move by IHC, through Ghitha Holding, aligns with the UAE's broader vision of achieving self-sufficiency in the food and agriculture sector. The government has actively pursued initiatives to enhance domestic production and reduce dependence on imported food sources. By strengthening its foothold in agricultural businesses like Al Ain Farms, IHC can play a significant role in supporting these national objectives.
The financial impact of this acquisition on Ghitha Holding's operations is expected to be revealed in their upcoming financial reports. However, industry observers anticipate a positive influence, with the potential for improved revenue and profitability through a more vertically integrated food production and distribution network. The deal also underscores IHC's commitment to expanding its footprint within the UAE's food security landscape.