David Wolpert of AMIE said, "There is a high demand on imported chicken due to its superior quality to that of SA. To increase duty costs to between 30% to 82% will see the industry lose anything up to 15000 workers."
Westville - Rainbow Chicken Ltd (RCL) announced on Monday that it has bought Foodcorp management’s 23.9 percent stake in Foodcorp bringing its total effective holding in Foodcorp to 88.1 percent.
RCL acquired an effective 64.2 percent of the issued ordinary share capital of Foodcorp through its subsidiary Capitau Investment Management Proprietary Limited (CIM) in April this year.
Rainbow has a 84.3 percent shareholding in CIM‚ which holds 76.1 percent of Foodcorp.
Management retained its holding of 23.9 percent in Foodcorp and it is this holding that RCL has now acquired for R393 million.
“This acquisition is in line with our strategy of becoming a food producer with significant scale to compete more effectively‚” said Miles Dally‚ CEO of RCL.
Foodcorp is a leading South African manufacturer of quality branded and private label food products and the range includes Yum Yum peanut butter‚ Ouma rusks‚ Pieman’s meat pies‚ Sunbake bread and bakery products‚ Bobtail and Dogmor pet foods‚ Nola mayonnaise and the popular maize drink Mageu No.1. Foodcorp also manufactures a wide range of quality convenience‚ ready-to-eat products for Woolworths and other retailers.
“The diversified range will assist in countering the cyclical nature of the chicken industry by broadening our range of respected brands and categories”‚ said Dally‚ adding “this additional direct stake further consolidates our position and we are very excited about it.”
The effective date of the transaction was July 1, 2013.