(Reuters) – Shareholders in Egypt’s Bisco Misr have agreed to sell a controlling stake to Kellogg as the world’s largest breakfast cereal maker emerged as the likely winner of an $87 million takeover battle for the cake and biscuit producer.
Private equity firm Abraaj said last week it would withdraw from a bidding war with Kellogg that had driven up the offer price by over 20 percent, leaving the U.S. group as the only remaining suitor.
Shareholders controlling 59.91 percent of the firm’s shares agreed to sell at 89.86 pounds a share, Bisco Misr said in a statement on Tuesday, for a total of just under $87 million.
The tussle over Bisco Misr is part of a flurry of mergers and rights issues boosting activity on the Cairo bourse, which has struggled to revive investor confidence in the turmoil that has followed the 2011 Arab Spring uprisings.
Though the values are relatively small, along with a takeover battle for Arab Dairy, the Bisco Misr acquisition suggests growing international interest in the Egyptian market.
Kellogg had indicated it was willing to buy 100 percent of Bisco Misr and would only accept a controlling stake.
It scuppered an effort by Abraaj to snap up the Egyptian company for an opening gambit of 73.91 pounds a share.
Though Kellogg appears almost certain to seal the deal, the regulator last month extended the bidding period to Jan. 11, which means another suitor could yet emerge.
Shareholders holding 56 percent of Bisco Misr agreed in November to sell their shares to Abraaj and a deal seemed likely until Kellogg entered the fray.
Food is seen as a fast-growing sector in the most populous Arab nation of 87 million people and Bisco Misr is a well-known brand with three baking facilities in Cairo and Alexandria.
($1 = 7.1500 Egyptian pounds) (Reporting by Lin Noueihed; editing by Jason Neely and David Evans)