A newly formed company, Milco SA, has announced that it would make an offer to acquire the entire issued share capital of Clover Industries Limited for R25/share, valuing the company at R4,8 billion.
Aran Oelsner, the CEO of CBC Group International, an Israeli company that will own 60% of Milco following the transaction, told Farmer’s Weekly that the acquisition was viewed as a stepping stone to expand operations into Africa.
He said the company was also looking forward to expanding and exploring the informal sector potential within South Africa’s townships and hoped to bring greater innovation to the South African dairy industry.
Richard Izsak, chief of staff at the CBC Group, said that this was the company’s first foray into Africa, but he expressed confidence that the rest of the role players in the consortium had unique experience in an array of fields that would slot in with the larger strategic objectives.
The remainder of Milco SA’s shareholding was divided between a South African black-controlled investment company Brimstone (15%); Ploughshare Investments Limited (11%); Incubev (8%) and Clover management (6%).
Johann Vorster, Clover CEO, said in a statement that the Milco SA offer presented significant value-unlocking opportunities, both for shareholders and for other Clover stakeholders.
Oelsner, who had himself operated a dairy for over a decade, also gave reassurances to dairy farmers that their milk would still be in demand.
“There is no dairy without the farmers,” he said.
According to a statement by the company, the transaction was subject to a number of conditions including certain regulatory approvals and Clover shareholder approval.
Once the process was completed, Clover would be delisted from the Johannesburg Stock Exchange, as well as the Namibian Stock Exchange.