Kuwait's fast-food group Americana scraps sale to consortium

Fast food outlets in the Mall of Dhahran in Dhahran, Saudi Arabia. Kuwait's fast-food group Americana owns the Middle East franchises for fast food chains KFC and Pizza Hut.
Fast food outlets in the Mall of Dhahran in Dhahran, Saudi Arabia. Kuwait's fast-food group Americana owns the Middle East franchises for fast food chains KFC and Pizza Hut. PHOTO: ST FILE

DUBAI (Reuters) - Kuwait's al-Kharafi family has scrapped a sale of a majority stake in Kuwait Food Co (Americana) to a Gulf-based consortium, a company controlled by the family said on Sunday, ending months of talks over the multibillion-dollar deal.

Americana, which owns the Middle East franchises for fast food chains KFC and Pizza Hut and also produces branded consumer foods, has been up for sale since early 2014.

Investment firm Adeptio, which is led by prominent Dubai businessman Mohamed Alabbar, in February agreed to buy 69 per cent of Americana from Al Khair for Stocks and Real Estate, which is controlled by the Kharafis, a wealthy merchant family.

The stake would be worth US$2.15 billion (S$2.9 billion) based on Americana's current market value of US$3.11 billion, according to Thomson Reuters data.

"An agreement has not been reached between Al Khair and Adeptio and both sides have agreed to end all negotiations in regard to the acquisition", Al Khair said in a statement. Americana made a similar announcement, but neither of these provided further details.

An Adeptio spokesman said: "The parties involved could not reach an agreement on mutually acceptable terms."

Before the Adeptio deal was provisionally agreed, banking sources had said other parties including Singapore's Temasek Holdings, Saudi food maker Savola Group, and private equity funds KKR and CVC had all expressed an in interest in Americana.

Had Adeptio concluded a deal with the Khorafis, the consortium would have been obliged to launch a mandatory offer to buy Americana's remaining shares under Kuwaiti securities rules.

Trading in Americana's shares was halted on Sunday pending an announcement from the firm.