ADNH Catering Targets Saudi Expansion Through Food Nation Acquisition
Deal News | Feb 24, 2025 | Zawya
ADNH Catering, a subsidiary of Abu Dhabi National Hotels, is on the verge of completing its acquisition of Food Nation Catering to expand its presence in Saudi Arabia's school food segment. CEO Clive Cowley forecasts that this segment could yield AED 250 million in revenues within three to five years. The UAE market presents an addressable value of AED 4 billion, with ADNHC expecting a CAGR of 5% in the next five years driven by factors like population growth and tourism in Abu Dhabi. Although ADNHC's primary market is Abu Dhabi, it is poised to increase its footprint in Dubai and the Northern Emirates. The company, which raised AED 864 million during its public listing in Abu Dhabi, operates across sectors including healthcare and education. ADNHC remains financially robust, reporting increased revenue and profit in Q4 2024. Previous expansion efforts include acquiring a controlling stake in Compass Arabia, targeting Saudi Arabia's healthcare sector. The firm prefers internal funding over debt for future growth, supported by an existing AED 250 million credit facility.
Sectors
- Catering and Hospitality
- Education Services
- Healthcare Services
Geography
- United Arab Emirates – Primary market of ADNH Catering, the company's headquarters, and location of its public listing.
- Saudi Arabia – Target for ADNH Catering's expansion through its acquisition of Food Nation Catering.
Industry
- Catering and Hospitality – The core focus of ADNH Catering and its expansions and revenue streams.
- Education Services – Relevance due to ADNHC's aim to grow within the school catering sector.
- Healthcare Services – ADNHC's operations in the healthcare sector signify expansion and growth opportunities.
Financials
- AED 250 million – Projected revenue from expanding the school food segment in Saudi Arabia within three to five years.
- AED 4 billion – Addressable market value in the UAE for ADNHC.
- 5% – Expected Compound Annual Growth Rate (CAGR) for ADNHC over the next five years.
- AED 864 million – Capital raised by ADNHC during its public listing in Abu Dhabi.
- AED 443 million – ADNHC's revenue in Q4 2024.
- AED 44 million – ADNHC's profit in Q4 2024.
- AED 500 million – Annual revenue from support services like cleaning, manpower supply, and pest control.
- AED 250 million – Revolving credit facility established by ADNHC for potential future acquisitions.
Participants
| Name | Role | Type | Description |
|---|---|---|---|
| ADNH Catering (ADNHC) | Acquirer | Company | A unit of Abu Dhabi National Hotels engaged in catering within various sectors. |
| Food Nation Catering | Target Company | Company | The company acquired by ADNH Catering to expand its market reach in Saudi Arabia. |
| Abu Dhabi National Hotels (ADNH) | Parent Company | Company | The parent company of ADNHC, operating in hospitality, catering, and related services. |
| Clive Cowley | Commentator | Person | CEO of ADNH Catering, providing insights into the company's strategic direction and financial outlook. |