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Olam Group has announced the proposed sale of its remaining 64.57% stake in Olam Agri Holdings. 

The proposal will see the remaining stake being sold to Saudi Agriculture & Livestock Investment Company (SALIC) in a two-tranche transaction, valuing Olam Agri at $4 billion. 

In tranche one, Olam will see sell 44.58% of its stake in Olam Agri to SALIC for approximately $1.78 billion, which will give SALIC a controlling stake of 80%. Tranche two will come into effect three years after the completion of tranche one, with the option for Olam to sell their remaining 19.99% stake to SALIC at the closing valuation plus 6% IRR. 

This transaction represents a 14% premium over the initial acquisition price, when SALIC purchased their first stake in Olam Agri in 2022. The sale is expected to generate a total gross of $2.58 billion from both tranches and forms part of the Olam Group’s reorganisation plan.  

Sunny Verghese, Olam’s co-founder and group chief executive officer, said: “Since SALIC’s investment in Olam Agri in 2022, our partnership with SALIC has unveiled new avenues of growth. With its strategic mandate as a global agrifoods investor and related complementary strengths, SALIC and Olam Agri share the same vision and focus on sustainable sourcing and commitment to meet the rising demand for food, feed and fibre.” 

Upon completion of tranche two, Olam Agri will be fully owned by SALIC, while Olam will continue to hold a 100% stake in OFI and the remaining Olam group.