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Ukraine’s MHP, Tanmiah invest in Saudi Arabia’s poultry value chain

Tanmiah Food Company and Ukraine’s MHP have agreed to co-invest more than SAR200m in farming operations with more than one million parent stock capacity, as part of a broader strategy to advance Saudi Arabia’s poultry value chain.

“Utilising our local knowledge combined with global best practices, our portfolio of best-in-class products, services, and solutions demonstrates our commitment to our customers, partners, and the broader objectives of Vision 2030,” said Zulfiqar Hamadani, the CEO of Tanmiah Food Company.

Tanmiah’s subsidiary Desert Hills Veterinary Services Company (DHV) will hold a 55 per cent shareholding in the venture while MHP will own the remaining 45 per cent stake. The parent stock is expected to produce approximately 175 million hatching eggs annually.

“Our collective strengths will catalyse transformative advancements in the poultry sector, fostering innovation and setting new benchmarks for excellence. The formation of this joint venture is an important first step,” said Dr John Rich, executive chairman of MHP.

The partnership is expected to significantly boost food security and self-sufficiency in poultry products in Saudi Arabia.

Tanmiah boosts Saudi food security

Meanwhile, signing the shareholder agreement is a decisive step in establishing the venture company after securing regulatory approvals, including clearance from the General Authority for Competition of Saudi Arabia.

The partnership builds on the MoU that DHV and MHP signed earlier this year.

Tanmiah posted SAR983.1m in half-year revenues, up 26.6 per cent year-on-year (YoY) from SAR776.7m a year ago.

Fresh poultry sales, which contributed 84 per cent to the company’s total revenues, increased by 22.2 per cent YoY in H1 2023 to SAR825.7m from SAR675.9m during the same period a year earlier. Saudi Arabia plans to invest $20bn by 2035 to boost the domestic food sector.

The country’s Agricultural Development Fund approved a significant number of credit facilities worth more than SAR4.2bn in H1 2023 to reinforce the country’s food security goals while ensuring the stability of food supply chains and developing the domestic agricultural sector.

Tanmiah’s business model positions it for growth on local, regional and global fronts, underpinned by favourable market trends.

Last year, US meat company Tyson Foods agreed to invest $70m in Tanmiah in return for stakes in subsidiaries that operate chicken hatcheries, feed mills and poultry-processing plants serving in Saudi Arabia, Kuwait, Bahrain, the UAE, Oman, Lebanon and Jordan.

Tanmiah partnered with the Public Investment Fund’s Halal Products Development Company in June to strengthen and localise the halal products industry in Saudi Arabia while supporting its development within the Middle East region.