EGYPT – Egyptian snacks giant Edita Food has signed two medium-term loan agreements worth EGP 390 million (US$12.60M) to finance investments related to the newly acquired frozen bakery segment for the next seven years.
Founded in 1996, Edita Foods is the leader in the Egyptian packaged snack market with a portfolio of brands that includes Molto, TODO, MiMix, Bake Rolls, Bake Sticks, and Hostess Cakes
According to Zawya, the EGX-listed firm will use the first loan, which is acquisition finance of EGP190 million (US$6.1) to cater for the proceeds of the facility to finance 50% of the acquisition amount related to Fancy Foods.
Meanwhile, the remaining EGP 200 million (US$6.5M) will be used to finance the investment cost required for the new subsidiary Edita Frozen for Food Industries.
In May this year, Edita Foods announced that it had entered the frozen bakery segment through the acquisition of Fancy Foods S.A.E., a local manufacturer specializing in the production of frozen foods for US$12 million.
According to the company, this new investment could notably enable Edita Foods to expand its business portfolio in the frozen food segment and consolidate its presence in the local food industry.
“The deal equips the Company with the necessary frozen technology infrastructure, marking a significant step in applying our R&D to complementary ventures while capitalizing on our market-leading portfolio of proprietary brands,” said Hani Berzi, Edita Chairman, said
The company revealed that the investment included the acquisition of 100% of the assets of Fancy Foods, namely two complete production lines and other machinery, as well as land, real estate, and a distribution branch.
The investments come amid the company’s impressive performance. In the first quarter (Q1) of 2023, Edita posted consolidated net profits after tax worth EGP 399.92 million, which marked an annual hike of 146.20% from EGP 162.42 million, including minority interest.
The company noted that the impressive performance which exceeded the previous record of 471.9 million pounds (US$15.4 million) was attributed to a 46.1% year-on-year growth in revenue totaling 7.7 billion pounds (US$250.8 million).
In addition, the company revealed that the celebrated performance is also supported by its activities in Morocco following the commencement of the cake production business in 2021.