BRF closes joint venture with halal meat company in Saudi Arabia

BRF (BRFS3) announced a joint venture with Halal Products Development Company (HPDC), a subsidiary of Saudi Arabia’s sovereign wealth fund, the Public Investment Fund (PIF).

The agreement concluded this Tuesday (1) is a continuation of the memorandum signed and communicated to the market in October 2022. Thus, BRF’s stake in the company will be 70%, while HPDC’s will represent 30%.

According to BRF, the creation of the new company aims to develop the halal product industry in Saudi Arabia through innovation.

Thus, the constitution of the agreement also provides for the creation of a headquarters for Halal Business, a Halal Food Innovation Center and a Center of Excellence.

It is worth remembering that halal products are a requirement of Islamic peoples, as they follow a series of norms for consumption by Muslims. Brazil is the main global exporter of halal food in the world.

According to data from the Arab-Brazilian Chamber of Commerce, in the decade ended in 2022, Saudi Arabia imported an annual average of 564,476 tons of Brazilian chicken products.

BRF and Saudi Arabia agreement
The joint venture comes days after Salic, a wholly owned subsidiary of PIF, acquired a 10.7% stake in BRF through a follow-up share offering. Saudi Arabia’s long-term goal is to ensure its food security.

“The consolidation of the joint venture represents a very important and strategic step for BRF’s global operations in a market of extreme relevance for the company. The company remains consistent in the development of the region and the Halal food industry as a whole”, highlights Marcos Molina, chairman of the board at BRF.

BRF has been present in the Middle East for over 50 years, supplying products to 14 countries in the region. Sadia is the market leader in the chicken category and recognized as the preferred brand in the region with a 38% share among consumers in the halal market.

The brand is the third most chosen in the United Arab Emirates, according to a survey by Kantar Brand Footprint 2023, released in July.

Thus, since 2009, the company has its own distribution in Saudi Arabia and in 2020 acquired a food processing unit in the country.

This week, Brazil and Saudi Arabia also signed a billionaire agreement for Brazilian agribusiness.

Finally, the volume of investment for the partnership was not disclosed.

Source: Money Times

To read the full original report, visit: https://www.moneytimes.com.br/brf-brfs3-fecha-joint-venture-com-empresa-de-carne-halal-da-arabia-saudita/

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