Tiger ramps up African expansion

18 February 2011

South African consumer goods group Tiger Brands has announced its intention to take over Davita, a South African foodstuffs manufacturer and exporter with a presence across Africa and the Middle East, for an estimated R1.3-billion.

Davita sells powdered seasonings and beverage products in 28 countries under three well-known brands, namely Davita (premium powdered beverages), Jolly Jus (mass-market powdered beverages) and Benny (powdered seasonings), and has a strong presence in many of the markets in which it operates.

Expanding African footprint

It reported an annual turnover of R567-million for the financial year ended 28 February 2010, of which almost 99% were derived from exports – which fits in well with Tiger Brands’ intention of expanding into the continent and beyond.

“As previously reported, Tiger Brands has identified growth on the rest of the African continent as one of its key strategic thrusts,” Tiger Brands said in a statement this week. “To this end, a number of transactions were recently announced which will meaningfully increase the company’s footprint on the rest of the continent.”

The company says it has been progressively building its sales and marketing infrastructure to service Africa, resulting in strengthened regional sales and marketing representation across the continent, enabling the company to increase brand awareness.

Self-standing entity

According to Tiger Brands, it intends to retain Davita as a self-standing entity within the Tiger Brands Group, adding that the relationship between Davita and its existing distributors will not be affected as a result of the proposed transaction.

“Davita has an established distribution footprint on the African continent which will provide Tiger Brands’ export division with new growth vectors by leveraging off Davita’s solid distributor relationships and penetrating new geographies as well as deepening market penetration in existing markets,” the company said.

“Davita will provide additional synergies as a potential manufacturer of certain products for Tiger Brands’ South African business units.”

SAinfo reporter

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