Private equity fund to focus on Middle East food industry

By Ankush Chibber

- Last updated on GMT

Private equity fund to focus on Middle East food industry

Related tags: Saudi arabia, United arab emirates, Middle east

Al Mal Capital has become the first financial firm to launch a private equity fund focused solely on the food and beverage sector in the Middle East.

According to a statement from the firm, the Al Mal F&B Fund will provide investors with access to a wide range of private equity investment opportunities within the food and beverage sector in the Middle East, North Africa and Turkey.

The fund was conceptualised, according to the firm, after market intelligence pointed to future growth in the wider region’s food and beverage sector.

Tariq Qaqish, head of asset management of Al Mal Capital, said that a combination of rising population and disposable income, specifically in the Gulf region, present a compelling opportunity for private equity investments.

“We are experiencing increased interest from businesses wishing to expand, and investors who desire to invest in the F&B sector. It is our intent to capitalize on the sector’s attractive opportunities and present our clients appealing ideas,”​ he said.

The fund, according to Qaqish, will invest in sub-sectors like local restaurants and bottled water companies across the Middle East, North Africa and Turkey.

FoodNavigator recently reported​ how bottled water consumption continues to grow in the UAE, thanks to rising demand built on a (once again) growing economy and increased health awareness.

Kartik Dwivedi, partner at Mumbai-based Dassler Business Intelligence, told FoodNavigator that the food and beverage sector in the regions on which the fund is focusing is one of the best performing sectors of all.

“Specifically in countries like the UAE, Saudi Arabia, Kuwait, Bahrain etc., we are seeing that the food and beverage sectors and all its sub-sectors are doing very well,”​ he said.

Dwivedi pointed out that with a growing population and also growing disposable incomes, spending on food and drink is expected to grow, and this in turn will offer promising investment opportunities.

“Of course with countries like the UAE, there is also the influx of tourists which keeps both the food service and food retail sectors busy,”​ he said. “Also, if the gradual opening of Iran to the world is not an illusion, I expect that food and beverage makers and sellers will find another growth market in the Middle East.”

According to Al Mal Capital, the initial price of units of the fund will be set at 100 dirhams (US$27) per unit, and there will be a minimum initial subscription to the fund of 250,000 (US$68,000). The first private placement fund for qualified investors, that will include institutional and high net worth investors, will have a target of 60m dirhams (US$16.5m).

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