Business
Model
Download PDF
OUR BUSINESS MODEL
A Focused Model That Aims for Sustainable Growth

Savola is a strategic investment holding company with a thematic investment program focused on the food and retail sectors, with the aim of creating value by enabling and accelerating growth levers in the underlying portfolio to achieve scale and profitability.

Our Strengths

Strategic Focus

Savola focuses its operations on a long-term consumer trend-driven lens, aiming to dynamically allocate capital to generate long-term value growth.

Strong Governance Framework

A robust governance and transparency framework, prioritized throughout Savola’s history, building shareholder trust.

Infrastructure and Consumer Access

Through our holdings, we possess Saudi Arabia’s largest distribution network, retail space and brand portfolio in the country’s consumer space and touch millions of consumers across all of our markets.

Our Challenges

Challenging macro-environment in Our operating countries, whereas a number of countries introduced economic reforms that may have a negative impact on the purchasing power of consumers

Change in consumer behavior, where consumer preferences and tastes may change in a more pronounced manner that may impact current products and business models

Limited number of transactable assets from the perspective of an investment holding whose key directive is to allocate capital

High relative valuation of food assets, in view of scarcity of sizeable assets that fit strategically with Savola Group’s investment mandate, as well as other factors including the economic and business cycles and their impact on such assets

How we add Value

Leadership and Governance

Savola’s focus as a strategic shareholder is to implement best practices across its portfolio to ensure:

  • Alignment of incentives among stakeholders; and

  • Selection of the right leaders and management teams to deliver on strategic and operational targets.

Setting Targets and Monitoring Performance

Savola is building the tools required for effective performance management across its portfolio. This includes both short-term and long-term operational and financial KPIs, with periodic reviews and a proactive approach that prioritizes the long-term best interest of the business.

Capital Allocation

Savola aims to maximize returns on investments by deploying or redeploying capital to enhance shareholder returns and create additional value by gaining access to segments with long-term potential within the consumer space. The primary objective is to generate sustainable excess returns over the cost of capital.

Long-Term Strategic Planning

Savola believes that in addition to managing our capital and operating companies for performance and long-term sustainability at the subsidiary level, our role is to look at our markets, our holdings, and our operations with a view to realize our ambition of maximizing our share of consumer spend across our markets profitably over the long-term horizon.

Our Corporate Values

Personal Values

Tawado: Confident Humility; Having the confidence to perform our responsibilities while having the humility to minimize our ego
It’qan: Relentless pursuit of perfection; The ability, willingness, desire, and intention to do our best to ensure that work is completed to the best standards
Azm: Fierce Resolve; Apply what we learn to improve ourselves Iq’tida: Apprenticeship; To seek out, interact with, and learn from those who are more knowledgeable than us

Group Values

Ihsan Al-Dhan: Trusting; Trusting others’ intentions without doubting them
Mu’azarah: Caring; Provide support to our colleagues to help enable their success
Qabool: Acceptance; Endure the views of others by going beyond tolerance or acceptance
Iq’bal: Approaching; Improve what we do by using what we have learned from the interaction with others

Corporate Values

Taqwa: Conscientiousness; Fulfillment of our responsibility toward external parties
Amanah: Honesty; Fulfillment of our responsibilities towards investors
Mujahadah: Personal control; Achieving the personal discipline necessary to fulfill our responsibilities
Birr: Caring Justice; Fulfillment of our responsibility toward our colleagues and the employees of the company

Investment Case

A Unique Investment Proposition

A leading Saudi strategic investment holding company with diverse investment portfolios of the largest assets and brands in the food production, marketing, distribution, and retail sectors, providing our shareholders with exposure to favorable demographics and structural trends in the regions we operate in.

A Regional Leader in Food and Retail

SAR 24 billion

One of the largest food and retail players in the region with an annual turnover of over SAR 24 billion

Forbes Top 100

Recognized among Forbes Middle East’s annual list of Top 100 companies in the region

#1 Staple food business

#1 basic food business in MENA, Savola has market leading positions and brands across consumer staples and value-added ranges, such as edible oils, sugar, pasta, and frozen food

#1 Grocery retailer

#1 grocery retailer in Saudi Arabia, Panda has strong brand equity and almost 25% market share in the attractive and under-penetrated modern retail space of the GCC’s largest market

Largest shareholder

Largest shareholder in 2 leading Saudi consumer brands, Almarai and Herfy, as well as popular frozen food brand, Al Kabeer

Consumer Understanding and Unique MENA Footprint

190+ stores

Dominant retail footprint with 190+ Panda and HyperPanda stores in 40+ cities across the Kingdom, with 90+ million annual transactions and the largest logistics network in Saudi Arabia

Serving 400+ million potential customers

Direct manufacturing and distribution strength in more than 8 countries, with 14 facilities serving a combined population of more than 400 million

Attractive exposure

Attractive exposure to large and growing population base with favorable demographics - more than 50% below the age of 35 years

Extensive knowledge

Extensive consumer, market and brand knowledge, successfully leveraged to launch, grow and maintain market-leading positions and products (e.g. Afia, Al Osra, etc.)

Customer-centric

Continuous customer-centric innovation and product development based on deep consumer outreach to capitalize on strategic opportunities to launch and scale new businesses in the rapidly maturing and evolving consumer space in MENA and beyond

Successful Track Record of Dynamic Capital Allocation

Unique investment model

Unique investment holding business model that allows for strategic investments and value creation in the MENA consumer food and retail space

Experienced leadership

Experienced leadership team with a clear mandate to deploy and/or reallocate capital to enhance shareholder returns through investments in consumer segments with long-term growth potential

40+ years

40+ year track record of business growth, active capital reallocation and long-term investment horizon

Sustainable growth

Actively exploring multiple venues of investments in food and retail to help drive sustainable growth for the Group for years to come