The purchase, completed on January 6, was of 1,790 acres of farm land in Blyth, through its fully-owned subsidiary, Fondomonte, California LLC.
Of the land, 1,590 acres are currently cultivated. This transaction forms part of Almarai's continuous efforts to improve and secure its supply of the highest quality alfalfa hay from outside Saudi Arabia to support its dairy business. It is also in line with the Saudi Government direction towards conserving local resources. In addition to this purchase, Almarai stated that it is committed to investing in the necessary infrastructure, including a baling system and logistics and transportation equipment necessary for the efficient supply of alfalfa hay from this US-based facility into Saudi Arabia.
The $31.8m will be financed from the company's own resources. The resulting increase in property, plant and equipment accounts will be reflected within the interim consolidated financial statements for the first quarter of 2016.
Almarai is the largest integrated dairy foods company in the world.