MHP SE Invests in Saudi Arabia

MHP SE

08 September 2023

 

 

08 September 2023, Limassol, Cyprus

MHP SE

MHP SE Invests in Poultry Value Chain in Saudi Arabia

MHP SE (LSE: MHPC), a leading international food and agrotech group with headquarters in Ukraine, today announces the signing of the shareholder agreement with Desert Hills Veterinary Services Company Limited (DHV) fully owned subsidiary of Tanmiah Food Company, a publicly listed company on the Saudi stock market and a leading provider of fresh poultry, processed poultry, and other processed meat products in the Middle East. This partnership is set to further develop MHP's diversification and growth internationally as well as boost food security and self-sufficiency in poultry products in Saudi Arabia.

Hereinafter, MHP SE and its subsidiaries are referred to as "MHP", "The Company" or "The Group".

The signing ceremony was held in Jeddah on 7 September 2023 and was attended by the Chairman of the Board of Tanmiah, His Excellency Sheikh Amr Al-Dabbagh along with the Board members and executive leadership, Saudi Government officials, representing ministries, authorities, funds, and centers of excellence and Ambassador of Ukraine, His Excellency Mr. Anatolii Petrenko. Executive Chair of the Board of MHP SE, Dr John Rich, and MENA Managing Director of MHP, Eugene Levterov, represented the Board and MHP at the ceremony.

Building on the foundation laid by the Memorandum of Understanding signed earlier this year, this partnership will see DHV and MHP SE join forces to invest more than SAR 200 million in farming operations with the capacity of more than 1 million parent stock expected to produce approximately 175 million hatching eggs annually a state-of-the-art hatchery and a poultry feed mill. DHV will hold a 55% stake, while MHP will have a 45% stake in the joint venture.

Dr John Rich, Executive Chair of the Board of MHP SE, stated, "Deepening our alliance with Tanmiah is a strategic pivot in MHP's global outreach. This partnership is emblematic of our shared vision to integrate international expertise with local insights, ensuring that Saudi Arabia's food security targets are met. Our collective strengths will catalyze 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. We are committed to a long-term, fruitful relationship that will benefit our organizations and the entire Kingdom of Saudi Arabia and the region. We will continue pursuing strategic opportunities in the region, seeking to capitalize on our expertise."

Zulfiqar Hamadani, CEO of Tanmiah Food Company, remarked, "Our collaboration with MHP signifies more than just a partnership; it represents our commitment to strengthen Saudi Arabia's food security framework. Utilizing 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."

Ahmed Bin Sharaf Osilan, Executive Board Member and Managing Director of Tanmiah Food Company, commented: "Our partnership with MHP is a strategic step to delivering sustainable value to our stakeholders and making significant strides towards Vision 2030. As we are working towards boosting food security and self-reliance in Saudi Arabia, we are building facilities that are critical in the entire poultry ecosystem in Saudi Arabia, increasing non-oil GDP private sector contribution, local employment opportunities, and knowledge transfer."

The signing of the shareholder agreement is a decisive step in establishing the joint venture company after the necessary approvals, including clearance from the General Authority for Competition of Saudi Arabia and other relevant jurisdictions, are secured.

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About Tanmiah Food Company

Tanmiah Food Company, established in 1962, is one of the Middle East's leading providers of fresh poultry, processed poultry, and other processed meat products, as well as animal feed and health products. It is a publicly listed company on the Saudi stock market. Al-Dabbagh Holding Group Company is the founding shareholder of Tanmiah Food Company. Tanmiah's fully integrated and highly efficient business model includes Farming, Primary Processing, production, further processing, and distribution with products sold in Saudi Arabia, the UAE, Bahrain, Oman, Jordan, and Kuwait. Tanmiah is also the master franchisee of Popeyes Louisiana Kitchen. As of 30th June 2023, Tanmiah operates 114 farms as well as six hatcheries, 2 feed mills, and four primary processing plants(slaughterhouses). Tanmiah distributes its products through a network of wholesalers, retailers, and food service outlets, as well as through its e-commerce platform. Sustainability is a core principle at Tanmiah, with initiatives including planting a million trees, using treated wastewater from its facilities, and turning waste products into fertilizer. For more information, visit www.tanmiah.com

About MHP SE

Established  in 1998, MHP SE is the parent company of a leading international food & agrotech group with headquarters in Ukraine, and production facilities both in Ukraine and in the Balkans (Perutnina Ptuj Group). 

Ukraine: MHP has the greatest market share and highest brand recognition for its products. MHP owns and operates each of the key stages of chicken production processes, from feed grains and fodder production to egg hatching and grow out to processing, marketing, distribution and sales (including through MHP's franchise outlets). Complete vertical integration practically eliminates MHP's exposure to raw material price fluctuations since its grain production exceeds internal consumption requirements, allowing the Company to be an important participant in the international commodity trade.  In addition to cost efficiency, vertical integration also enables MHP to maintain strict biosecurity and to control the quality of its inputs and the resulting quality and consistency of its products all the way to the point of sale. To support its sales, MHP maintains a distribution network consisting of nine distribution and logistical centers within major Ukrainian cities. MHP uses its own truck fleet to distribute its products, reducing overall transportation costs and delivery times.

MHP also has a leading grain cultivation business growing corn, soya and sunflower to support the vertical integration of its chicken production and increasingly other grains, such as wheat and rapeseed, for sale to third parties. MHP leases agricultural land located primarily in the highly fertile black soil regions of Ukraine.

The Balkans: Perutnina Ptuj (PP) is a leading poultry and meat-processing producer in the Balkans, with production sites in four Balkan countries: Slovenia, Croatia, Serbia, Bosnia and Herzegovina. PP owns distribution companies in Austria, Macedonia and Romania and supplies products to fifteen countries in Europe. PP is vertically integrated across all states of chicken meat production - feed, hatching eggs production and incubation, breeding, slaughtering, sausage production and further poultry processing.

MHP trades on the London Stock Exchange under the ticker symbol MHPC. For more information, visit mhp.com.ua

Contact Information:

MHP SE

Ms. Anastasiya Sobotyuk, IR Director

Tel. [phone]

Email: [e-mail]

Office EB1, 3-7 Arch Bishop Makario III Ave

6017 Larnaca, Cyprus

www.mhp.ua, www.mhp.com.cy

 

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