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Nofoth signs MoU to acquire 70% stake in Al Waal Al Bari Beverages
The non-binding MoU gives Nofoth a path into the Saudi beverage market. Due diligence and regulatory hurdles remain. Completion would add a new revenue stream.
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Nofoth Food Products Co. signed a non-binding memorandum of understanding on June 28 to acquire a 70% stake in Al Waal Al Bari Beverages Co. The agreement, reached with several shareholders of the beverage company, marks the first formal step in a potential buyout.
For Nofoth, a Saudi food producer with a focus on dairy and poultry, the deal offers a move into beverages. Al Waal Al Bari operates in the non-alcoholic drink segment, covering bottled water and juices. The company also produces carbonated soft drinks. The Saudi beverage market has grown steadily, driven by population expansion and rising disposable incomes. A controlling stake would give Nofoth direct exposure to that growth without building a new brand from scratch.
Non-binding MoUs are common in Saudi corporate transactions. They set broad terms but let the buyer walk away if due diligence uncovers financial or operational issues. The parties also need regulatory clearance from the Saudi General Authority for Competition and other bodies. Nofoth did not disclose the proposed valuation or a target date for signing a definitive agreement. Until those details emerge, the deal remains in a preliminary phase.
Due diligence will focus on Al Waal Al Bari's financial health, supply chain, and customer contracts. Red flags could push Nofoth to renegotiate the price or walk away. The non-binding structure gives it flexibility. Regulatory approval is required for any acquisition that could reduce competition. Approval is likely; however, it is not guaranteed, because Nofoth and Al Waal Al Bari operate in different product categories.
The parties did not set a deadline for due diligence. Similar transactions typically require 60 to 90 days to complete the review. After signing a definitive agreement, the deal may need shareholder approval if the purchase price is material relative to Nofoth's market capitalization.
Shareholders will watch for the next Saudi Exchange filing. Nofoth typically updates the market when it signs binding agreements or when material developments occur. Trading volume may pick up around news of the due diligence progress.