European Commission Clears SALIC’s Plan to Buy Olam Agri

The European Commission has approved, under the EU Merger Regulation, the acquisition of sole control of Singapore-based Olam Agri Holdings Limited (Olam Agri) by Saudi Agricultural and Livestock Investment Company (SALIC) of Saudi Arabia.

The transaction, which aligns with Saudi Arabia’s Vision 2030 objectives to enhance food security and diversify economic investments, relates primarily to the trade and processing of agricultural goods.

The Commission concluded that the notified transaction would not raise competition concerns, given the limited impact on the market structure. The transaction was examined under the simplified merger review procedure.

This approval follows SALIC’s agreement to purchase an 80.01% stake in Olam Agri for approximately $1.78 billion.

Transaction Details

SALIC, a subsidiary of Saudi Arabia’s Public Investment Fund (PIF), initially acquired a 35.43% stake in Olam Agri in December 2022. The recent agreement involves purchasing an additional 44.58% stake, brought SALIC’s total holding to 80.01%.

The European Commission’s review determined that the merger would not significantly impede competition within the EU market, thereby granting approval under the simplified merger procedure.

Strategic Objectives

This acquisition is a strategic move by SALIC to bolster its presence in global agricultural markets, particularly in grains, feed, and edible oils. The deal is expected to enhance Saudi Arabia’s access to essential commodities, supporting the nation’s food security goals.

The total valuation of Olam Agri at $4 billion reflects a 14% premium over the previous valuation in 2022.

Future Plans

Following the completion of the initial transaction, Olam Group retains a 19.99% stake in Olam Agri, with an option to sell this remaining interest to SALIC within three years.

This phased approach allows for a structured transition and potential full acquisition by SALIC. The deal is anticipated to close in the fourth quarter of 2025, subject to final regulatory approvals and customary closing conditions.

The European Commission’s approval of SALIC’s acquisition of Olam Agri underscores the alignment of this transaction with broader economic and strategic objectives, particularly concerning food security and agricultural investment.