Denmark’s Arla enters Joint Venture with Egypt’s Biggest Diary Company

Egypt-based Juhayna Food Industries, one of the largest dairy product and juice makers in the country, will form a joint venture with Denmark’s Arla Foods that will be 51 percent owned by the Egyptian firm and managed by Arla, Juhayna said Thursday.

The venture, ArJu Food Industries, will “expand Juhayna’s product portfolio to include cheese, butter and infant formula,” and will aim to start sales in Egypt in October, the statement said.

“It is a very good match for both parties. Juhayna has a nationwide distribution network, and we are not competing within the same product categories. Together we now get a broader product portfolio, which strengthens the business of both parties,” says Arla’s senior vice president of the Middle East & Africa, Rasmus Malmbak Kjeldsen.

Juhayna owns 51 per cent of the new joint venture company, while Arla owns 49 per cent. However, Arla will be in charge of the daily management of the joint venture. The ambition is for the company to also start up local production in Egypt.

“We have built our entire business in the Middle East through cooperation with local partners. In Arla we excel at making joint ventures succeed, and that is a business model we will use to establish ourselves in other African markets as well,” says Rasmus Malmbak Kjeldsen.

He estimates that the new joint ventures company will have 40-50 employees, and he predicts that the work force will exceed 100 employees within the next year or two.