Rhodes acquires Pacmar, sets sights on SSA
The recent acquisition of Pacmar by the Rhodes Food Group is intent on its part of further expansion into Sub-Saharan Africa. The transaction valued at N$160 million should entrench Rhodes as a segment leader.
Its expansion into Sub-Saharan Africa represents a potential market of over 700 million people apart from the 170 million consumers in South Africa, Namibia, Botswana, Zimbabwe, Zambia, Mozambique and Kenya. Pacmar currently manufacturers juice brands Amazing and Zing, sold in various retailers in Namibia while the Rhodes Food Group manufactures a variety of popular canned food products. Its product portfolio consists of jam and tomato spreads, various pineapple, peach, guava, baked beans, pees, and corn products.
The acquisition should be completed by 1 April 2015 as the group intends to make good on proceeds from generated during its listing on the Johannesburg Stock Exchange late last year October 2014, allowing to raise over N$500 million. Other notable key financial highlights apart from the listing include a sharp spike in operating profit of 47.9% to N$246 million, an increase in normalised headline earnings per share of 40.5% to 36.8 cents, and turnover equating to N$2.4 billion.
Following the good run of results as well as a massive cash injection following the listing, N$102 million has been earmarked for capacity expansion and production efficiencies. An investment programme which should be concluded this year will see Rhodes upgrade its Bull Brand facility, increase its storage and dispatch capacity at its fruit production facilities and an increased capacity and upgrading of its pie facility as it seeks to make massive inroads into Africa.