Almarai completed the purchase of 9,834 acres of farmland in Vicksburg, Arizona, US, on March 6, according to the company’s announcement posted on Tadawul website.
The purchase was done through its fully-owned subsidiary Fondomonte, Arizona LLC, composed of 3,604 acres of freehold land, 3080 acres of agriculture lease hold land and 3,150 acres of grazing lease hold land.
The total consideration for this transaction amounts to $47.5 million, equivalent to SR178.1 million, and will be financed from the company’s own resources.
Within the total land subject to this transaction, 4,430 acres are currently irrigated using the best modern methods such as dripping irrigation.
This transaction forms part of Almarai’s continuous efforts to improve and secure its supply of the highest quality alfalfa hay from outside the Kingdom to support its dairy business.
It is also in line with the Saudi government direction toward conserving local resources.
In addition to this purchase, Almarai is committed to invest into the necessary infrastructure, including a bailing system and logistics and transportation equipment necessary for the efficient supply of alfalfa hay from its US-based facility into the Kingdom
The resulting increase in property, plant and equipment accounts will be reflected within the interim consolidated financial statements for the first quarter of 2014, the company stated.