Boycott: Saudi Arabia’s Almarai to Replace Centrale Danone?

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Time: June 19, 2018

As Centrale Danone, a subsidiary of the giant French dairy company Danone, has begun to count its losses with the ongoing boycott against it, the Middle East’s leading food and beverage manufacturer and distributor, Almarai, has emerged as an attractive future investor in the country.

The Saudi company is expected to open its first subsidiary by the end of 2018 or early in 2019.

The company has reportedly bought land belonging to the headquarters of Centrale Danone in the kingdom, according to Moroccan news site Hespress.

For years, many Moroccans expressed their wish to have Almarai dairy product brands in Morocco due to their “high quality.”

Founded in 1977 in Saudi Arabia, Almarai is a partnership between the Irish agri-foods pioneer, Alastair McGuckian, and Saudi prince Sultan bin Mohammed bin Saud Al Kabeer. Almarai is now the world’s largest vertically integrated dairy company.

Almarai, headquartered in Riyadh, produces dairy, yoghurt, pastries, infant formula, and more than 1.2 billion liters of milk per year. It employs more than 4,700 workers.

The decision may have been within the framework of Saudi Arabia’s Vision 2030 to boost economic partnership with Morocco by increasing the volume of direct foreign investment.

Will Morocco say goodbye to Centrale Danone?
Almarai’s decision to invest in the dairy sector in Morocco coincides with the ongoing boycott targeting Centrale Danone, the leading dairy brand in Morocco.

The decision also poses questions of whether it will be the end of an era for the dairy firm, formerly known as Centrale Laitière, which has extended its roots in the kingdom since 1949.

On April 20, Moroccans launched a boycott against three major companies at once, Afriquia (gasoline), Sidi Ali (mineral and soda water), and Centrale Danone, in protest against the high prices set by these companies.

The boycott campaign has caused major revenue loss for Centrale, as it recently announced that it had a net loss of MAD 150 million in the first half of 2018.

This article was first published in Morocco world news

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