Gulf Capital, a leading equity firm in the Middle East, exits CHO Group, the largest olive oil producer in North Africa.
Gulf Capital, a leading private equity firm investing across the Middle East and Southeast Asia, has announced the successful completion of its exit from Tunisia’s CHO Group, a fully-integrated producer and global exporter of olive oil and the largest operator in North Africa.
The deal reflects Gulf Capital’s strategy of increasing its investments in food security and sustainability across the Middle East and Southeast Asia.
GHO Group: Farm-to-fork
CHO Group manages one of the largest ‘farm-to-fork’ operations in the sector globally, using sustainable farming methods. The company has demonstrated its societal and environmental commitment by supporting Tunisian farmers and millers and promoting various awareness-raising “good behavior” practices in sustainable farming, particularly for olive oil.
The company expanded its production facilities during the partnership period with Gulf Capital. It grew its local and global footprint through local acquisitions, backward vertical integration, and rapidly expanding its global export markets. As a result, the company increased its revenues by approximately 33 percent. It doubled the number of countries it exports to, extending its reach to a record 50 countries across North America, Europe, Asia and Africa while maintaining double-digit EBITDA margins.
Sustainable measures
CHO Group is committed to putting in place a sustainable development strategy based on new plantations to minimize its carbon footprint and promote investments in regional development areas to create new business opportunities, employment, and wealth.
CHO Group has integrated over 3,200 hectares of land, which produce olives to be used by its processing facilities and is planning on increasing this to 4,200 hectares over the next couple of years. In the face of increased competition and inflationary raw-material cost pressures, backward integration would help CHO Group to maintain its strong position and grow its margins despite a high inflation environment and spiraling energy costs. Research shows that about one-third of food costs are energy-related, with transportation and packaging costs representing the bulk of the rest.
Mr Abdelaziz Makhloufi, Co-founder and CEO of CHO Group, said, “Demand for food is going to continue to increase over the next decade, driven by population growth and other factors. Supported by Gulf Capital and our other investors who believed in us and shared our vision and values, CHO Group has been cultivating its growth on solid grounds and is now ready for its next phase of growth. I want to thank Gulf Capital for their support and for providing us with the growth capital necessary to fund our rapid expansion and global exports.”