Middle East Glass, a Gulf Capital Portfolio Company, acquires 100% of Egyptian Misr Glass Manufacturing
February 18, 2016
Acquisition helps MEG expand capacity and consolidate its position as Egypt’s largest
container glass manufacturing company for the food and beverage sector.
Capital, one of the largest and most active alternative investment firms in the
Middle East, announced today that one of its
portfolio companies, Middle East Glass ("MEG") has acquired 100% of
Misr Glass Manufacturing ("MGM"), which is specialised in the manufacturing and
marketing of container glass for the food and beverage industry. This
acquisition creates the largest glass packaging manufacturer not only in Egypt
but also in the MENA region and establishes a solid ground for further growth,
including cross-border regional and international expansion. The company is a worldwide approved
supplier of glass bottles for Coca-Cola, an approved supplier for Pepsi, Nestle
and other major beverage producers locally and regionally.
MEG's most recent acquisition of MGM will create
the largest glass packaging manufacturers in Egypt. Prior to this deal, MGM was
the second largest container glass manufacturer with three furnaces having a total
production capacity of 141,000 tonnes per annum, producing glass containers in
flint, amber and green colours and catering for both local and export markets.
The Group will have six furnaces with a combined total production capacity of
378,000 tonnes per annum serving major local and international food and beverage
Dr. Karim El Solh, Chief Executive Officer of Gulf
Capital, said: "MEG is rapidly positioning itself as the largest Arab glass
packaging manufacturer, both through organic growth and through acquisitions.
This latest acquisition of Misr Glass Manufacturing gives the combined
businesses significant scale and allows MEG to increase its share of exports. The
investment in MEG and MGM fits with our strategy to partner with exciting local
companies and to grow them into regional and global leaders. It also allows us
to make indirectly a strategic investment in the fast growing Egyptian consumer
The MGM acquisition will create significant
operating leverage and production opportunities across the combined platform.
The local integration of glass operations will realise operational efficiencies
and procurement synergies. With six furnaces, the enlarged platform will
effectively manage its production capacity and deliver better flexibility,
faster response time and higher service to its customers. The acquisition will
provide MEG with significant capacity enabling it to expand its export base
into new markets.
Abdul Galil Besher, Chairman of Middle East Glass,
said: "With this latest acquisition, Middle East Glass will become the leading
glass packaging manufacturer in Egypt with a strong platform to accelerate our
export led growth to our traditional regional food and beverage customers and
beyond. Misr Glass Manufacturing brings a strong customer base in our target
markets, an attractive portfolio of products and flexible production capacity
and will add depth to our leadership team. We are very confident that the
acquisition will create significant value for all MEG stakeholders."
MEG, a leading diversified packaging group, was
established in 1979. It has grown into Egypt’s largest glass manufacturer,
starting as a 117,000 tonne per annum one-furnace glass manufacturer and,
through a strong programme of acquisitions, culminated into a six-furnace
operation with a production capacity of 378,000 tonnes per annum. MEG is an
approved supplier of multinational companies such as Coca-Cola, Pepsi and
Nestle and is positioned to grow its exports in regional and international markets,
given its expanded capacity and product range.
Tarek Mounib, Executive Director, Private Equity at
Gulf Capital, concluded: “MEG has a significant cost advantage relative to
international peers due to its lower cost base and access to local raw materials,
translating into a competitive export advantage with rewarding margins. Egypt
is therefore a very attractive market from which to export internationally. The
MEG platform plans to yield significant human capital efficiencies by focusing
on initiatives in training and development of all personnel across the plants."
and Gulf Capital were advised by investment bank HC Securities & Investment
and the law firm Maatouk Bassiouny in Egypt.
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