Established in 1998, Merec Industries has solidified its position as a market leader in Mozambique's food sector. The company specializes in producing a variety of wheat-based products, including maize meals, wheat flour, pasta, biscuits, and animal feed. Headquartered in Matola, Mozambique, Merec employs approximately 260 individuals and has built a reputation for delivering high-quality packaged foods to both Mozambican and South African markets.
The acquisition aligns with Invictus Investment's strategic objectives to enhance its presence in the African agro-food industry. In 2023, the company reported a 35% increase in revenue, reaching AED 8.1 billion, up from AED 5.9 billion in 2022. This growth was accompanied by a significant surge in commodity transaction volumes, which more than doubled to 5.37 million metric tonnes from the previous year's 2.56 million metric tonnes. The company's expansion strategy included entering ten new markets, among them Morocco, Tanzania, Mozambique, Turkey, Malawi, Burundi, Rwanda, Kenya, Uganda, and Lebanon, as well as diversifying its product offerings to include commodities such as soybean meal and seed, corn, vegetable oil, soybean hulls, fertilizers, wheat flour, and Distiller’s Dried Grains with Solubles .
Amir Daoud Abdellatif, CEO of Invictus Investment, commented on the company's performance, stating, "Amid the backdrop of geopolitical and economic challenges in the global landscape, we have delivered a record financial performance in 2023—a resounding testament to our operational resilience. The year has been one of remarkable strides in our growth journey, most significantly through geographic expansion into ten new markets and the diversification of our portfolio into new products."
The acquisition of Merec Industries is expected to further bolster Invictus Investment's position in the agro-food sector, particularly in the Southern African region. Merec's established market presence and diversified product line complement Invictus's strategic vision of becoming a vertically integrated agro-food enterprise. This move also underscores Invictus's commitment to investing in downstream acquisitions within the value chain to enhance operational capabilities and meet the evolving needs of its global clientele.
In 2018, Merec Industries attracted investment from Amethis Fund II, Kibo Fund II, and Proparco, which acquired a minority equity stake to support the company's growth strategy. This partnership aimed to reinforce Merec's dominant position in Mozambique and facilitate its expansion into the Southern African Development Community region. The investment facilitated Merec's diversification from wheat and maize milling into a broader food fast-moving consumer goods player, including the production of pasta, biscuits, and animal feed.
The recent acquisition by Invictus Investment marks a significant milestone in Merec's growth trajectory, providing the company with a strong capital base to accelerate future development. Mhamud Charania, Chairman of Merec Industries, previously expressed enthusiasm about such partnerships, stating, "Through this investment, Merec is firmly poised to capture the next phase of its growth trajectory from a strong capital base to accelerate future growth."
Mozambique's favorable demographic profile and strategic geographic location have contributed to its appeal as a hub for agro-food enterprises. Despite facing economic challenges in the past, the country has demonstrated macro-economic stabilization and offers a promising outlook for investors in the agro-food sector.
The acquisition of Merec Industries by Invictus Investment is anticipated to have a positive impact on Mozambique's economy by enhancing the agro-food value chain, creating employment opportunities, and contributing to food security in the region. As Invictus continues to explore potential acquisitions and develop new joint ventures in strategic markets, this move signifies a commitment to sustaining its growth trajectory and enhancing contributions to the global food supply chain.
Industry analysts view this acquisition as a strategic alignment of complementary strengths. Invictus's extensive distribution network and financial resources, combined with Merec's established market presence and production capabilities, are expected to create synergies that will drive growth and innovation in the agro-food sector across the region.
As the global agro-food industry continues to evolve, such strategic acquisitions highlight the importance of consolidation and diversification in achieving sustainable growth. Invictus Investment's proactive approach in expanding its market reach and product offerings positions the company to effectively navigate the complexities of the global food supply chain and meet the increasing demand for diverse and high-quality food products.