State-linked investment firm ADQ’s acquisition of a 50 percent stake in multinational agribusiness Al Dahra Holding Company became the latest transaction described as reflecting an unprecedented focus on food security in Abu Dhabi.
A source familiar with Al Dahra told Agri Investor the investment theme, which has taken hold in Abu Dhabi and throughout the Middle East, could have an impact on US exports.
“Largely, there is some interest in more portable assets: how can I bring IP or techniques or capabilities and actually on-shore them in some of these non-US locations?” said the source, adding that controlled environment agriculture is a specific sub-sector that has seen increased interest from food-security focused investors.
“That is absolutely an intense focus right now. That could have impact on US export businesses, so it’s something to keep an eye on.”
Financial details for the investment were undisclosed.
ADQ chief executive Mohamed Hassan Al Suwaidi said in a statement: “Since 1995 when Al Dahra was founded in the UAE, it has grown into a global food and animal feed company and is a pillar of Abu Dhabi and our country’s food security mandate.
“With our investment, Al Dahra will be well positioned to further expand its reach and footprint while enabling Abu Dhabi to reach its goals of continuing to diversify its food sources and growing into a regional food hub.”
Al Suwaidi said high growth and the sector’s key role in Abu Dhabi’s socio-economic agenda had also helped make food and agribusiness a focus of ADQ’s overall strategy. ADQ’s existing exposure to food and agriculture includes investments in food and beverage provider Agthia Group and Al Foah, a date producer.
Al Dahra co-founder and vice-chairman Khadim Abdulla Al Darei added that ADQ’s investment would position the company to execute on the government’s food security mandate, which he said had become “an even greater priority than ever before.”
Al Dahra focuses on the cultivation, production and trading of animal feed and essential food commodities. It manages a supply chain that includes 350,000 acres of irrigated farmland, including properties with connections to the Nile, Colorado and Danube Rivers and 15 processing facilities allowing it to service cattle and dairy markets. The company supplies customers in more than 45 countries and has at least 20 operations, including flour mills in Greece and Bulgaria, an olive oil production facility in Morocco and Serbian dairy farms.
In late 2017, Al Dahra formed a joint venture with Saudi Agriculture and Livestock Co to develop agricultural properties in Black Sea region countries including Ukraine, Poland and Romania, among others.
At the inaugural meeting of the Emirates Food Security Council in February, Minister of State for Food Security Mariam Hareb Almheiri, said the council was to be the central authority driving implementation of the UAE’s national Food Security Strategy. That responsibility, said Almheiri, includes oversight of the investment agenda within the food system, including both domestic and international investments.
ADQ, which operated as Abu Dhabi Development Holding Corporation before a re-branding earlier this year, declined to comment.