Tunisia: ambitious goals for Sicam in the coming years

 Pan-African private equity firm Development Partners International (DPI), through its third fund ADP III, has made a USD56 million investment in Tunisian tomato processing and agri-business, SICAM.

Established in 1969, SICAM is a leading producer of canned tomatoes, pepper pastes, and jams and one of the most recognised brand names in Tunisia’s food and agri-industry, with a strong track record of delivering quality products to its customers. Wholly owned by the Bayahi Group, a leading Tunisian conglomerate, SICAM has quickly become the fastest growing player and market leader of the sauces and condiments segment in Tunisia, in part driven by its strong relationships with the local farming industry, enabling it access to consistent tomato harvests. 

SICAM is the only player operating through a vertically integrated model including PROCAN (100 per cent subsidiary of SICAM) which manufactures metallic cans for SICAM in various formats, and SICAM AGRI (50.5 per cent subsidiary of SICAM) which provides farmers with technical advice, financing, tools and agricultural inputs. Despite the Covid-19 crisis, demand remains strong given the nature of SICAM’s products and sales continue to increase. 

DPI, as an active investor, will be partnering with the Bayahi Group to support SICAM’s management team in the development of SICAM’s future strategy and growth opportunities, including further strengthening SICAM’s leading position in its core market of Tunisia, as well as developing its export strategy in light of Tunisia’s and SICAM’s competitiveness in the industry. Through this partnership, SICAM will benefit from DPI’s significant regional and sector expertise and its active management approach to investing. 

According to the Ecofin Agency, the operation represents the second commitment of the African Development Partners III (ADP III) and the first in the Tunisian agrifood sector. "Tunisia is the largest consumer of [processed] tomatoes per capita in the world, and has significant export opportunities," said Development Partners International in a note on this investment. 
 
According to the investment firm, market demand for Sicam products has remained strong and the company's sales have increased despite the negative economic effects caused by the covid-19 pandemic.

The investment is in line with DPI's investment strategy, which is focused on the emerging middle class in Africa and consumer-oriented industries, says Runa Alam, Co-Founder and Chief Executive Officer at DPI. The investment also reaffirms DPI’s commitment to driving economic development across Africa, with agriculture being key to the continued advancement of Africa’s fast growing emerging middle class. SICAM’s partnership model with local farmers and the canned food products processed and sold by the company cater to the emerging middle class. “The objective for the next few years of the Industrial Society of Food Preserves based in Medjez El Bab is to have agricultural partners able to increase their production up to 120 metric tonnes per hectare, thus reaching the world standard”, explained Tahar Bayahi, CEO of SICAM. For 50 years, SICAM has supported farmers in several regions, such as Béja, Kairouan and now Gafsa. DPI, through its “Impact and Environment Social Gouvernance” team, will also focus during the investment period on increasing resilience to climate change impacts and on promoting sustainable agricultural practices throughout the business and supply chain. The investment will allow SICAM to further improve the incomes of the farmers it partners with and the sustainability of food supply in the country. 

 Runa Alam, CEO at DPI, says: “We are pleased to be investing in SICAM. The agri-business industry presents an excellent way for DPI to deliver both financial returns while making an impact on the lives of SICAM stakeholders.” 

Sofiane Lahmar, Partner at DPI, says: “SICAM has successfully positioned itself as the market leader in the Tunisian tomato business, with its products becoming household names across the country, synonymous with quality. Access to food and food production are key to Africa’s continued economic growth and development and SICAM is well positioned to benefit from these macro trends. DPI looks forward to working with the experienced Bayahi Group, who possess a strong track record of building successful businesses of scale across the country”.

Tahar Bayahi, SICAM Chairman and CEO, says: “We are delighted to welcome DPI on board as experienced and active investors as we focus on bringing our quality food and tomato products to our existing and expanding customer base. DPI has significant sector experience and expertise investing across the region, and we look forward to working with them to continue to drive the growth of our business and SICAM’s international and export strategy."

On March 6, 2020, an Extraordinary General Meeting of SICAM decided to increase the capital of the company by 105 million dinars. As a result of this increase, the company’s share capital is now a little over 150 million Tunisian Dinars (Euros 47.5 million or USD 51.7 million, value May 2020)

Sources : privateequitywire.co.uk, agenceecofin.com, financialafrik.com, leconomistemaghrebin.com, ilboursa.com, africanmanager.com