Clover Industries, South Africa’s largest dairy company, is switching cheese production from a facility in the town of Lichtenburg to another plant due to issues with the local municipality over water and power supply.

The Lichtenburg factory, which is situated in the North West Province and comes under the Ditsobotta municipality, will be closed. Cheese manufacturing will be transferred to Clover’s existing site in Queensburgh, a town in KwaZulu in the Greater Durban area under the eThekwini authority.

Clover explained in a statement: “For years, the Lichtenburg factory has been experiencing water and power outages and the surrounding infrastructure has not been maintained by the municipality. Despite numerous efforts to engage the municipality on these matters, the issues have not been resolved.

“This has negatively impacted production which requires a continuous process, and it is no longer feasible for the business to operate in Lichtenburg. Clover already has operations in Queensburgh and the eThekwini municipality has proven to be supportive.”

A spokesperson for Clover said the company would not be providing further comment when asked by Just Food if the production switch had already taken place and what the future plans are for the Lichtenburg site.

Clover, which produces branded dairy products such as milk, yogurt, cheese and butter for the local and international markets, was taken over by an investor consortium in 2019 known as Milco in a deal worth ZAR4.8bn (US$354.5m today). It also delisted from South Africa’s Johannesburg Stock Exchange as well as the Namibian exchange.

Milco comprises International Beer Breweries, a subsidiary of the Central Bottling Company in Israel, the Mauritius-based investment firm IncuBev, Ploughshare Investments and Clover’s management team.

Before the deal was struck in 2019, Clover had been struggling financially, with a series of prior profit warnings.