Deadline extended for Bisco Misr takeover bids

Cereal manufacturer Kellogg’s and UAE-based equity firm Abraaj have been in a bidding war that has pushed the company’s value above LE1 billion.

Egypt’s stock market regulator has extended the bidding period for snack food manufacturer Bisco Misr until January 11. The company has been the subject of a heated bidding war between Kellogg’s and the Abraaj Group, both of whom are seeking to buy a majority stake in Bisco Misr.

If there are additional bids, the deadline will be extended for five days per offer, for a maximum of 60 days from the initial offer. After that, the companies will have to submit sealed bids.

According to Abraaj, the official offer period for its initial bid began on November 20. Adding 60 days would push the final deadline to January 19.

Bisco Misr, which produces biscuits, cakes, cornflakes and other baked goods at its three Egyptian factories, has been contested for months. Since bidding heated up in November, the company’s prices has risen by more than 20 percent.

Abraaj initially offered LE73.91 per share, amounting to a total purchase price of around LE850 million.

Kellogg’s entered the fray on November 20 with an offer to buy shares at LE79, for a total purchase price of LE908.5 million.

On November 26, Abraaj made a counter-offer of LE80.58 per share, amounting to a total purchase price of LE926.67 million

The bidding war continued throughout December, with Kellogg’s offering LE82.2 per share on December 1, followed by a December 17 offer by Abraaj for LE84.66 per share.

On December 18, Kellogg’s upped its bid to 86.36 per share.

Regulators approved two bids on December 25, both of which pushed the company’s total sale price above LE1 billion: one from Abraaj at LE88.09 per share, quickly followed by a counter-offer of LE89.86 per share by Kellogg’s.
 
Kellogg’s and the Abraaj Group have both said they hope to expand the Bisco Misr brand regionally and globally, and that they intend to retain the companies employees, should their bids be successful.

“One of Abraaj's key strategy focuses in regards to Bisco Misr is to employ more staff and create job opportunities. It also includes retaining employees and respecting their rights, and not terminating staff unless in legally justifiable cases and as per the Labour Law,” the Abraaj Group said in a December 24 statement.