Tongaat, Bokomo complete N$220m deal
By Hilary Mare
SUGAR manufacturer, Tongaat Hulett has announced that all conditions related to the sale of its entire sugar packaging and distribution business in Namibia have been fulfilled.
The company sold these assets, effective July 1, to breakfast cereal company Bokomo Namibia for N$220 million.
The last outstanding suspensive condition to the proposed transaction had been the approval of the Namibian Competition Commission.
Tongaat Hulett has been disposing of various businesses and assets in an effort to reduce its debt by N$8.1 billion by March 2021, including an agribusiness in eSwatini for N$375 million and its starch business for N$5.3 billion, the sale of which is pending a contractual investigation with the potential buyer -Barloworld.
The completion of the deal means Marathon Sugar, joins several well-known household brand names manufactured or distributed by Bokomo Namibia, including Bokomo wheat flour and maize meal, Weet-bix cereal, Moirs, Liqui-Fruit, Ceres, Fruitree, Caribbean, Safari dried fruit and nuts, John West and Wellington’s tomato sauce.
Bokomo Namibia CEO Hubertus Hamm explained that the deal will benefit consumers: “We now have significant scale, which allows us to compete more effectively and, thus, enables us to provide a large range of complimentary food and beverage products to our valued customers and consumers across Namibia.”
Late last year, Confidente reported that Tongaat Hulett had released a statement on the Johannesburg Stock Exchange indicating that its board had considered its Namibian business as non-core and was of the view that its disposal would allow the Namibian business to grow into new areas while facilitating Tongaat Hulett’s access to the market via long term sugar and related products supply agreements concluded with Bokomo.
In October last year, the Zimbabwe Stock Exchange (ZSE) suspended Tongaat Hulet Zimbabwe’s subsidiary, Hippo Valley Estates Limited, from trading its shares on the local bourse.
According to the stock exchange, this followed the sugar giant’s failure to release its full year financial results that missed the June 30 deadline and also missed the extended deadline of July 31.
In addition to that, the Johannesburg Stock Exchange-listed sugar producer, at the time, had also secured a voluntary suspension of the listing of its shares on the Johannesburg and London Stock exchanges, to cut costs and streamline its shareholding structure.
The board had requested that its listings be suspended amid a forensic probe, after the company announced that its financial results for the year to March 2018 would have to be restated.
Bokomo Namibia is a joint venture between the Frans Indongo Group and Pioneer Foods, a large South African-based food, and beverage company. In March 2020, Nasdaq-listed PepsiCo Inc finalised its takeover of Pioneer Foods, an important step in its Africa-expansion plans. Tongaat Hulett Namibia is a joint venture between Tongaat Hulett South Africa and the Frans Indongo Group.