In a strategic move aimed at consolidating its position in the Kingdom’s food and beverage sector, Alamar Foods the signing of a binding agreement to acquire full shares of Arabian Passion Company (Arabian Cravia), the company that owns the exclusive rights to operate and develop the famous Five Guys brand in Saudi Arabia.
Details of the deal and acquisition
According to a statement published on the Saudi Stock Exchange (Tadawul) website, the deal is valued at SAR 85 million, a figure subject to some standard adjustments upon closing based on the terms of the agreement. Under this acquisition, ownership of 13 Five Guys restaurants currently operating in the Kingdom will be transferred to Alamar Group's portfolio, representing a significant expansion in the diversification of brands managed by the company.
The company explained that the financing for this deal will be through a combination of the company’s own resources and Sharia-compliant banking facilities, noting that the completion of the transaction is still subject to obtaining the necessary regulatory approvals, including the approval of the General Authority for Competition and the approval of the global franchisee.
Strategic dimension: Entering the premium burger market
This deal reflects Alamar's clear strategic direction towards expanding into the burger sector, which is the largest category within the fast-food restaurant market in Saudi Arabia. Acquiring a brand as prominent as Five Guys represents a strong entry point into this market, given the brand's global reputation for serving fresh, premium burgers and its broad customer base.
Through this move, Alamar seeks to capitalize on the high growth opportunities in this sector and diversify its revenue streams through a multi-brand platform, thereby reducing operational risks and enhancing its market share in one of its key markets in the region.
Financial performance and future prospects
Financially, the target company (Cravea Arabia) enjoys a strong financial position, operating without any liabilities or bank debt. Financial projections indicate that the acquired company's adjusted EBITDA will reach approximately SAR 17 million in 2025, following the application of IFRS 16.
Alamar expects this acquisition to have a positive impact on its financial statements once the deal is completed and final approvals are received, enhancing shareholder returns and supporting future growth plans.
Context of the restaurant sector in the Kingdom
This event comes at a time when the restaurant and hospitality sector in Saudi Arabia is experiencing rapid growth, driven by changing lifestyles and increased consumer spending, in addition to the significant support the tourism and entertainment sector receives within the Kingdom’s Vision 2030. This acquisition confirms the attractiveness of the Saudi market for global brands and the desire of major local companies to acquire prominent names to enhance their competitiveness.
