LONDON (Bloomberg) - Singapore's Temasek Holdings has teamed up with Saudi Arabia's Savola Group to bid for Middle Eastern fast-food operator Kuwait Food in a deal that could be valued at between US$4 billion (S$5.7 billion) and US$5 billion, according to two people with knowledge of the matter.
Talks between the three companies are ongoing and a deal could be reached before the end of the year, the people said, asking not to be identified as the information is private. JPMorgan Chase & Co. is advising Savola, which has a market value of about US$8.5 billion, on the talks, the people said.
Savola had bid on its own to acquire Americana, as Kuwait Food is known, at the end of last year, people with knowledge of the matter said in December. A buyout group including KKR & Co. and CVC Capital Partners Ltd. also bid to acquire the Kuwaiti company after it began a sale process in mid-2014, the people also said.
Americana was founded in 1964 and is the franchise operator of restaurants such as KFC, TGI Friday's and Pizza Hut in the Middle East and North Africa region. It also manufactures produce including California Garden beans and Farm Frites frozen vegetables.
The Al-Kharafi family, which has interests in the construction, telecommunications and financial sectors, owns 66.8 per cent of Americana, according to data compiled by Bloomberg. The company posted net income of US$183 million for the fiscal year ending 2013 on sales of US$3.2 billion. The stock has dropped over the past month, erasing about $1 billion from the company's market value.
Temasek has sought out consumer companies to broaden its investments and benefit from increasing disposable incomes. It completed the HK$44 billion (S$8.1 billion) purchase of 25 per cent of Hong Kong-based Hutchison Whampoa's retail arm A.S. Watson & Co. during the year through March 31.
Singapore's state-owned investment firm also singled out life sciences and agriculture among the top three industries it is backing. Apart from A.S. Watson, it added assets in US pharmaceutical firm Gilead Sciences and Indian drugmaker Intas Pharmaceuticals.
Temasek is also in exclusive talks to buy the headquarters of Time's UK unit in a venture with Oxford Properties Group for about 465 million pounds (S$1 billion), a person with knowledge of the matter said last month.
Temasek and JPMorgan declined to comment on the bid for Americana, while Savola and Americana didn't immediately respond to calls and e-mails requesting comment.