The Competition Tribunal, this week, approved a merger in which Langeberg Foods will acquire Langeberg and Ashton Foods, a division of Tiger Consumer Brands.
The news that NewCo, a consortium of local fruit farmers and a Norwegian equity partner, will buy the Ashton canning factory has been widely welcomed.
Its uncertain future had caused many headaches for employees and producers alike since Tiger Brands made its intention to exit the canned deciduous-fruit market known as far back as 2020.
The factory has more than 3 000 permanent and temporary workers, and around 250 fruit producers, who deliver their fruit to the factory. If it were to close the impact on the small town of Ashton, with its 13 000 residents, would more than likely have been devastating.
Since opening its doors in 1940 the factory has produced canned fruit under Tiger Brands’ label Koo.
In May the company stated its intention to sell Langeberg and Ashton Foods as a going concern to NewCo for a total of R1. As part of the sale Tiger Brands will commit R150 million to establishing a community trust that will benefit the broader Langeberg community through socio-economic-development initiatives.
This amount will be advanced on the implementation of the transaction. The community trust will ultimately hold a beneficial interest equal to 10% shareholding in NewCo, the consortium holding the balance of the equity.
