In a bid to further expand into Saudi Arabia’s market, ADNH Catering, a leading food and support services group in the UAE and the GCC, announces today that it has entered into a sale and purchase agreement for the acquisition of an additional 20 percent equity share in its Saudi joint venture, Compass Arabia, from Compass Group. Completion of the transaction is expected to occur in the first quarter of 2025.
“With the increase of our equity share in our Saudi joint venture, we are seeking to build out from our market-leading position in the UAE to expand ADNH Catering Group’s operations across various business segments and provinces in the Kingdom, including Riyadh,” stated Clive Cowley, CEO of ADNH Catering Group.
Saudi JV to get revamp
ADNH Catering, which listed on the Abu Dhabi Securities Exchange earlier this year, will acquire an additional 20 percent equity stake in the Saudi joint venture, increasing its shareholding from 30 percent to 50 percent. Al Rushaid Group will hold the remaining 50 percent equity stake. The company also announced that the Saudi joint venture will undergo a rebranding following the completion of the transaction.
Along with entering the agreement, ADNH Catering entered into a shareholder agreement with Al Rushaid Group where the group will manage the Saudi joint venture and have control over its operations.
“The SPA entered with Compass Group to acquire an additional 20 percent equity stake in the Saudi joint venture within a month of completing our IPO is a testament to our clear and unwavering resolve to expand our operations in the Kingdom in pursuit of business growth and shareholder value creation,” added Cowley.
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Healthcare sector growth opportunities
Compass Arabia currently offers the Saudi market solutions in the food services segment in addition to support services. ADNH Catering Group believes that Riyadh, as Saudi Arabia’s largest and most rapidly expanding city, and the high-growth private healthcare sector represent especially compelling opportunities to increase market share in the Kingdom.
The compelling macroeconomic growth story in Saudi Arabia also makes it an attractive market for ADNH Catering Group. In addition, the growth of its operations in Saudi Arabia is a key pillar of its strategy.
Compass Arabia has seen healthy business growth, with the number of clients growing by 17 percent from September 2021 to September 2023. Building on this momentum, ADNH Catering Group plans to leverage its know-how, extensive experience, reputable client portfolio, and impressive track record across the sectors it serves in the UAE to expand its operations across various business segments and provinces in the Kingdom.
