Tiger Brands exits deciduous canned fruit business, establishing R150 million community trust
JSE-listed Tiger Brands has exited its deciduous canned fruit business five years after it said it could do so for R1 while also setting up a R150 million community trust to benefit the Langeberg community.
Image: Tiger Brands/Facebook
JSE-listed Tiger Brands has exited its deciduous canned fruit business five years after it said it could do so for R1 while also setting up a R150 million community trust to benefit the Langeberg community.
In a statement, the company, said this deal would ensure 'a sustainable business' and protect 'over 3 000 permanent and seasonal jobs'. Langeberg and Ashton Foods was founded in 1940, and its products are sold into the retail market under the Koo, Gold Reef and Silverleaf labels.
Tiger Brands will also complete an effluent plant upgrade with a further investment of R31m to ensure 'the operations continue to adhere to environmental regulations'.
Tiger Brands CEO, Tjaart Kruger, said on Friday that the sale followed 'an extensive search for a viable buyer over the last five years'. Noting that the deal is in the best interests of all stakeholders, he said that the 'success of this sale will ensure the sustainability of the South African deciduous fruit industry and consequently improve the livelihoods of the Langeberg and Ashton Foods employees and the broader communities in these areas'.
Tiger Brands, South Africa's largest food company, made this announcement just days after it said it would settle a class action lawsuit that was the result of a Listeria outbreak in January 2017, which was traced back to an Enterprise Foods factory. The value of the disclosure was not announced,
Its disposal of the deciduous canned fruit business, Langeberg and Ashton Foods, is to 'a capable and committed consortium comprised of parties with a vested interest in the sustainability of Langeberg and Ashton Foods and a cooperative of fruit growers in the Ashton area,' it said.
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The unit, located 180km east of Cape Town, provides employment to more than 3 000 permanent and seasonal employees and 'is an important contributor to the region's economy,' said the company.
Tiger Brands said that the consortium buying the company was made up of Ashton Fruit Producers Co-operative as well as an unnamed development finance institution. The Ashton Fruit Producers Co-operative, established in 2020, is made up of member producers from the Robertson, Ceres, Breederivier and Klein Karoo areas.
The deal is set to benefit the broader Langeberg community through socio-economic development initiatives, and the Community Trust will ultimately hold a beneficial interest equal to 10% in the new company.
Langeberg Municipality, previously known as the Breede River/Winelands Municipality, is home to around 100 000 people.
'Tiger Brands has been part of the Langeberg region and its communities for many decades. The establishment of the Community Trust is a notable milestone for the region, as Tiger Brands remains committed to the distribution of social and economic benefits to the community of Langeberg, long after our exit. This contribution is aligned with our purpose to nourish and nurture more lives every day,' said Kruger.
Anthony Dicey, Chairman of The Ashton Fruit Producers Co-operative, noted that the canning factory had become 'integrated into the community and the local fruit growers that supply it'.
The agreement is subject to regulatory approvals and is expected to be completed within the second half of this year.
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