South African poultry group Rainbow Chicken has agreed to buy the poultry processing operations of Bush Valley Chickens, in a deal expected to be worth ZAR92.5m (US$12.5m).

"This acquisition extends Rainbow's national footprint and reflects our commitment to invest in line with our strategic growth plan," Rainbow Chicken CEO Miles Dally said yesterday (12 September).

The facility, located near Tzaneen in Limpopo province in South Africa processes around 150,000 chickens per week. This will expand over time "to meet our anticipated demand," Dally added.

The transaction is subject to approval by the Competition Commission, the poultry firm added. The date of effective control is anticipated to be early in 2012.

Rainbow Chicken is one of the largest chicken producers in South Africa, processing 4.6m chickens a week.

The company's revenue increased to ZAR8.6bn for the first half of the year, up from ZAR7bn during the same period last year.