28 October 2015
Newly established government-owned enterprise Oman Food Investment Holding Co (OFIC) has unveiled an ambitious array of farming, funding, commodities trading and R&D initiatives that promise to have a game-changing socioeconomic impact on the Sultanate's agricultural and farming sector. The initiatives, which include plans for an Agricultural Private Equity Fund, portfolio of food stocks, commercial fodder production facilities, Food Techno Park, hedge fund for food commodities, and trading platforms for commodities trading, will build on OFIC's flagship ventures -- a mega dairy farm and processing facility, and large-scale poultry project costing RO 100 million apiece. These latter ventures are in currently in the early stages of implementation.
Dubbed 'Future Projects', the initiatives are line with the holding company's mission to invest in food projects individually or in partnership with various strategic investors inside and outside the Sultanate, aimed at promoting self-sufficiency where possible, and food security for Oman, the company said. Notable among these proposals is a plan to set up an Agricultural Private Equity Fund. "The objective of this fund is to locate start-ups as well as established projects and to take stakes at an early stage to capitalise on enormous growth potential in this sector," said OFIC. "The theme is to collaborate/invest with existing and new (international) players at project size of RO 100 million.
The investments will be targeted both locally and internationally and analysed and short listed based on their viability. The primary aim is to generate good IRR (Internal Rate of Revenue) in a span of 3 to 5 years," it stated. Also on the anvil is a plan to develop a proprietary portfolio of food stocks at a size of RO 10 million, according to OFIC. "This is the portfolio of high liquid listed stocks in the agricultural and food sector. Stock selection will be based on growth prospects, past track record, management integrity and profit potential. The portfolio will consist of 20 to 30 stocks with an average investment size of RO 0.25 to 0.50 million. Investments will be made with a medium-term perspective of 3 to 5 years with a target IRR of 10 to 20 per cent."
In addition to investments in food processing related activities, the state-owned holding company says it also intends to establish commodity trading platforms and a hedge fund for food commodities. "These activities are mostly interrelated and an integrated project is intended to be promoted encompassing all these activities," it said. Furthermore, to support its mega dairy project, which is anticipated to boast a herd size of around 25,000 head of cows in 10 years, Oman Food says it plans to invest in commercial hay and fodder production farms overseas. Likely locations are Sudan, Spain and the United States (California) where water and other natural resources necessary for such ventures are in relative abundance, it said.
Rounding off its impressive list of 'future projects' is a proposal for a Food Techno Park designed to serve strategic national objectives, the company said. "The project involves developing an information / data centre to facilitate research and innovation in food processing, encouraging new ideas and bringing out various different concepts and innovations in food related activities. The idea is to promote SMEs and venture capital firms to bring out hidden talents and potential in the food sector," Oman Food Investment Holding Company added.
Newly established government-owned enterprise Oman Food Investment Holding Co (OFIC) has unveiled an ambitious array of farming, funding, commodities trading and R&D initiatives that promise to have a game-changing socioeconomic impact on the Sultanate's agricultural and farming sector. The initiatives, which include plans for an Agricultural Private Equity Fund, portfolio of food stocks, commercial fodder production facilities, Food Techno Park, hedge fund for food commodities, and trading platforms for commodities trading, will build on OFIC's flagship ventures -- a mega dairy farm and processing facility, and large-scale poultry project costing RO 100 million apiece. These latter ventures are in currently in the early stages of implementation.
Dubbed 'Future Projects', the initiatives are line with the holding company's mission to invest in food projects individually or in partnership with various strategic investors inside and outside the Sultanate, aimed at promoting self-sufficiency where possible, and food security for Oman, the company said. Notable among these proposals is a plan to set up an Agricultural Private Equity Fund. "The objective of this fund is to locate start-ups as well as established projects and to take stakes at an early stage to capitalise on enormous growth potential in this sector," said OFIC. "The theme is to collaborate/invest with existing and new (international) players at project size of RO 100 million.
The investments will be targeted both locally and internationally and analysed and short listed based on their viability. The primary aim is to generate good IRR (Internal Rate of Revenue) in a span of 3 to 5 years," it stated. Also on the anvil is a plan to develop a proprietary portfolio of food stocks at a size of RO 10 million, according to OFIC. "This is the portfolio of high liquid listed stocks in the agricultural and food sector. Stock selection will be based on growth prospects, past track record, management integrity and profit potential. The portfolio will consist of 20 to 30 stocks with an average investment size of RO 0.25 to 0.50 million. Investments will be made with a medium-term perspective of 3 to 5 years with a target IRR of 10 to 20 per cent."
In addition to investments in food processing related activities, the state-owned holding company says it also intends to establish commodity trading platforms and a hedge fund for food commodities. "These activities are mostly interrelated and an integrated project is intended to be promoted encompassing all these activities," it said. Furthermore, to support its mega dairy project, which is anticipated to boast a herd size of around 25,000 head of cows in 10 years, Oman Food says it plans to invest in commercial hay and fodder production farms overseas. Likely locations are Sudan, Spain and the United States (California) where water and other natural resources necessary for such ventures are in relative abundance, it said.
Rounding off its impressive list of 'future projects' is a proposal for a Food Techno Park designed to serve strategic national objectives, the company said. "The project involves developing an information / data centre to facilitate research and innovation in food processing, encouraging new ideas and bringing out various different concepts and innovations in food related activities. The idea is to promote SMEs and venture capital firms to bring out hidden talents and potential in the food sector," Oman Food Investment Holding Company added.
© Oman Daily Observer 2015
