SIFEM - Swiss Investment Fund for Emerging Markets

March 2022


«We have major expansion plans in Sub-Saharan Africa»

In 2017, SIFEM invested EUR 10 million in Maghreb Private Equity Fund (MPEF) IV, the fourth fund in this series from AfricInvest, an independent private equity fund manager that specifically focuses on Africa. In 2018, MPEV IV invested in the Tunisian company Land’Or, which produces fresh cheese and spreadable cheese. The following interview with Dr Hatem Denguezli, co-founder and CEO of Land’Or, covers various topics related to the development, strategy and management of the company and also addresses the impact of the COVID-19 crisis. Dr Hatem Denguezli has run Land’Or since it was founded in 1994. The company has been present in Morocco since 2013 through a commercial subsidiary. In 2020, it embarked on a plan to open a production site there, which is expected to be up and running by early 2022.

Almost three decades ago, you co-founded Land’Or. At the time, what motivated you to co-found a cheese company?

Myself and my fellow co-founder are veterinarians. I specialised in surgery on large animals and my colleague specialised in agrifood. After an initial foray into halal meats, which unfortunately did not work out due to the mad cow crisis, we set up a cheese company. With AfricInvest’s support (Tunivest at the time), we began producing spreadable cheese under an industrial assistance contract with an Austrian cheese maker. Since then, Land'Or has been able to overcome a number of obstacles to become a successful and financially sustainable company.

How has demand for cheese products evolved in Tunisia over the past three decades?

The market has grown threefold in the last 30 years and still holds a lot of potential. Tunisians consume less than three kilogrammes of cheese per year, whereas Europeans consume seventeen kilogrammes, almost six times more.

What is Land’Or’s winning strategy and how do you compare to your competitors?

We opted for innovation, which is now part of our DNA. For example, we introduced grated cheese to the Tunisian market. We also developed cheese slices, which are used in the food service sector, and created fifteen-gram snacks as well as melted cream cheese. Land’Or is number one in Tunisia in the cheese products sector in terms of volume, and we rank second in terms of revenue. We have two competitors, one of which is a Tunisian family group and the other the leading dairy producer in the country.

Land'Or was listed on the Tunis stock exchange in 2013. How did this milestone help you on your growth path?

At the time, we were undercapitalised and saw the IPO as a way to get out of that situation. I do not regret the IPO experience, but we are a little disappointed by the obtained results. For instance, in our last capital increase, the stock exchange only participated to the tune of 5%.

What role did investors such as AfricInvest and development finance institutions (DFIs) such as SIFEM play in supporting the development of your activities?

They supported us throughout our journey. We share the same values and they are always attentive to our concerns and very logical in their thought process. We industrialists like to take risks, whereas the financiers prefer to err on the side of caution. Excessive risk-taking should be avoided, as should excessive caution. That makes us a good fit!

In 2020, Land’Or expanded into Morocco. Why did you choose Morocco in particular?

We set up a commercial subsidiary in Morocco in 2013. At the time, Tunisia was experiencing its “Arab Spring” and Libya had become too unstable, prompting us to seek other options. There were limited prospects in Algeria because the legal framework did not allow foreign investors to acquire majority stakes in Algerian companies. In contrast, Morocco offered attractive investment opportunities and a large domestic market, three times the size of the Tunisian market. Today, exports to Morocco account for 40% of our revenue. However, we realised that it made even more sense to produce on site, which is why we are investing in a local factory that should be up and running soon. This is a major step for Land’Or.

What future opportunities do you see in the medium and long term? Are you planning other expansions like the one in Morocco most recently?

We have some major expansion plans in Sub-Saharan Africa for the coming years, but this means that we will have to adapt our product line. Cheese consumption is very low in Africa, except in North Africa. There are two reasons for this. Firstly, eating habits in Africa do not include cheese, and secondly, it is still an expensive product. We are already working with foodservice operators, and we are considering branching out into sauces for example. This strategy should enable us to gradually gain a foothold in different markets and create new eating habits. The Tunisian plant will focus on the Tunisian, Libyan and Middle Eastern markets, while the Moroccan plant will cater for the Moroccan market and Sub-Saharan Africa.

In terms of production, what processes have you put in place to comply with international food safety and hygiene standards?

We have two certifications: FSSC 22000 Food Safety System Certification and HACCP (Hazard Analysis and Critical Control Points) certification, which is another widely accepted international standard. We are very attentive to overall quality in our production processes. It is worth mentioning that Kraft Heinz, the world's 5th largest agrifood group, outsourced production to us in 2018 and 2019. Producing for the Kraft brand puts us under a great deal of pressure to deliver products of the highest standard. Moreover, in the Middle East and Africa, we were the only company to be audited and accepted by Kraft.

How has the COVID-19 crisis affected Land’Or’s activities, particularly in terms of supply chain management? And are we correct in saying that Land'Or was considered a critical industry during the pandemic and was therefore able to continue to operate?

Yes, Land’Or was permitted to continue operating during the pandemic in strict compliance with public health measures, to ensure food availability. Despite the crisis, 2020 marked the strongest growth in our history. The dairy products market flattened out, but we managed to bite off market share from our competitors, mainly thanks to the mutual trust we have built up with our suppliers. This meant that we were able to deliver our products without hindrance.

Have you had to resort to short-time working or furlough schemes – or redundancies in the wake of the crisis?

Not at all. On the contrary, we had to recruit 133 temporary workers between 2020 and 2021, who are still on the payroll as we speak.

Is it relatively easy to find qualified workers in Tunisia or Morocco? And how does Land’Or go about providing in-service training for its employees?

In Tunisia, it is not hard to find suitable candidates. We have yet to see if the same can be said of Morocco. We have three types of in-service training programmes: in-house training, training provided by specialised external agencies, and foreign training sessions with our international suppliers. We are ISO 9001-certified and FSSC 22000-certified. This requires us to have a modicum of training in place. We attempted distance training during the COVID-19 crisis, but it has not been ideal. We are therefore waiting for the resumption of in-person training.

The unemployment rate among young people is particularly high in Tunisia at more than 40% according to the national statistics institute. What is the proportion of “young workers” (aged 18-25) at your company and what does Land’Or do to promote the employment of young people? Do you have an apprenticeship programme for example?

18 to 25-year-olds currently make up 11% of our staff, and the apprenticeship programme is mandatory. This programme is our main channel for hiring young workers. Depending on their capabilities, an individual may be given the opportunity to move to a fixed-term contract and, ultimately, a permanent contract.

One of the major problems in recent years is the fast-paced automation of certain industrial processes and the resulting impact on jobs. How do you feel about this, and what might be the consequences on employment?

I see automation as a huge opportunity, because it is clear that some tasks are particularly hard for workers. Packing bags of grated cheese in boxes for eight hours straight is not very rewarding. A machine could perform such repetitive tasks. The challenge will be to change workplaces in order to best harness workers’ skills.

What is Land’Or’s philosophy when it comes to labour relations?

There are lines that must not be crossed at Land’Or. First of all, people must be respected at all times. Everyone must be respected, regardless of whether he or she has committed an intentional or unintentional error for example. There is no hierarchy among humans. There is only a professional hierarchy. Secondly, employees’ rights must be respected by promoting safety in the workplace and ensuring the protection of all workers.

How does the salary paid by Land’Or compare to the average Tunisian salary (around EUR 250/month)?

We are 20% above the market. Our salaries average EUR 300 per month.

Let’s move on to another topic that affects all companies: climate change. Tunisia is particularly exposed to this phenomenon, especially in terms of water stress, as well as other environmental issues such as soil erosion and soil pollution. What impact do these issues have on the company’s operations and how does Land’Or intend to deal with this going forward?

Land’Or is committed to reducing its environmental footprint. Our new plant in Morocco, for example, will have state-of-the-art refrigerated production equipment capable of keeping CO2 emissions to a minimum. In Tunisia, we have tried to reduce our electricity consumption through cogeneration. However, Tunisian law does not encourage manufacturers to use cogeneration to any significant extent. We are also working to reduce our water consumption as much as possible, by using a closed-circuit equipment cooling system for example. But we need to do more. We are keenly aware of this. The entire dairy industry is facing major environmental challenges, beginning with livestock farming. In fifty years from now, it is highly likely that we will be facing a shortage of meat and milk and will need to turn to plant-based alternatives that are less water-intensive. Plant-based protein is still a small market with a “health” angle, but I think that in a few decades it will become the mainstay of human food. This is a global trend and has prompted us to enter negotiations with a soybean producer to prepare the food production of the future.

Dr Hatem Denguezli is a Tunisian businessman with more than three decades of experience in the cheese industry. He is the co-founder of Land’Or, which he has managed since it was founded in 1994. Dr Denguezli has a PhD in Veterinary Medicine from the École nationale de médecine vétérinaire de Sidi Thabet (ENMV) in Tunisia.


  • Founded in 1994
  • Headquartered in Tunis
  • 629 permanent and temporary employees – 80% permanent and 20% temporary
  • 41% of staff are women
  • Production of 17,500 tonnes of cheese in 2020, with more than 30% for export
  • Systematic training of staff, development of the professional expertise of senior managers

Maghreb Private Equity Fund IV

  • SIFEM invested EUR 10 million in the Maghreb Private Equity Fund (MPEF) IV in 2017
  • Maghreb Private Equity Fund (MPEF) IV – a fund with a volume of EUR 230 million
  • Fund Manager – AfricInvest

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