Saudi company SALIC to buy out Olam’s stake in Olam Agri 

SALIC, a state-owned entity, currently holds a 35.4% stake in Olam Agri, having acquired it in 2022 as part of a Strategic Supply & Cooperation Agreement between the two parties.

The announcement came after Bloomberg reported that a potential deal was being negotiated.

In a statement released to the Singapore Exchange (SGX), Olam Group confirmed receiving a non-binding indicative offer from SALIC. The statement added that Olam is currently exploring the offer with the help of its appointed advisers, evaluating the possible sale of the remaining stake in its agribusiness division.

“While the company is reviewing and in discussions regarding a potential sale of its stake in the Olam Agri business, the company would like to stress that no definitive terms or formal legal documentation have been agreed upon between the parties to date,” the statement said. “There is no certainty that a sale of the company’s stake in the Olam Agri business will proceed or will materialize.” 

Olam Agri, one of the two key divisions of Olam Group alongside Olam Food Ingredients, handles a diverse portfolio, including managing the Queensland Cotton business, which operates six gins, as well as multiple warehousing facilities across Queensland and New South Wales. It also manages a pulse packing and trading operation.

SALIC’s connection with Olam Group began in 2022 when the Saudi firm invested US$1.24 billion to acquire the 35.4% stake in Olam Agri. At the time, SALIC’s Group CEO, Sulaiman Al Rumaih, emphasized that the investment was part of the company’s strategy to advance food security. “SALIC’s key strategic objective is to contribute to global and domestic food security through long-term strategic investments in the local and international markets,” Mr. Al Rumaih stated.

Wale Edun, Minister of Finance and Coordinating Minister of the Economy (CME), stated on Sunday, December 29, 2024, after meeting with President Bola Tinubu in Ikoyi, Lagos, that “what we have brought back is investment. What we have brought back is foreign exchange. What we have brought back is jobs for Nigerians.”  

The minister’s statement comes after the high-level delegation to Saudi Arabia, to follow up on President Tinubu’s earlier engagements with His Royal Highness Prince Mohammed bin Salman Al Saud, Crown Prince and Prime Minister in Riyadh, on November 10, 2023, on the sidelines of the Saudi-African Summit and again in Riyadh, on November 12, 2024, on the sidelines of the Extraordinary Arab and Islamic Summit, where the two sides reviewed ways of cooperation. They also talked about plans and ideas for strategic agriculture investments, among other items on the summit’s agenda.

Naijaonpoint understands the minister may have been referring to the 2022 acquisition of 35% stake at $1.2 billion in Olam Agri.