South African food giant Tiger Brands has bought Nigerian biscuit maker Deli Foods and a majority stake in an Ethiopian food firm in a bid to increase its footprint outside its home country.
The firm said yesterday (25 November) that it had acquired a 51% stake in an unnamed Ethiopian personal care and food company and the entire business of Deli Foods.
Tiger expects the two acquisitions, scheduled for completion early in 2011, to generate a combined annual turnover of ZAR500m (US$70m) in the first year.
Tiger CEO Peter Matlare said Ethiopia had been “experiencing high GDP growth rates”, while the acquisition of Deli Foods marks the company’s first move into Nigeria and Tiger is set to expand further in the west African state.
The company has also agreed, in principle, to buy a 49% stake in the food and drink businesses owned by local conglomerate UAC of Nigeria. The businesses generated sales of ZAR477m in 2009.
“Tiger Brands believes that the proposed transaction with UAC will provide the two partners with a sound strategic platform in Nigeria, which will benefit from the respective parties’ experience, skill and expertise in the manufacture, marketing and distribution of branded food and beverage products in emerging markets,” Matlare said.
He added that Tiger Brands was currently pursuing other opportunities on the continent. “If successful, they will further increase our manufacturing and distribution footprint outside South Africa.”
The firm yesterday booked a drop in full-year profits, hurt by empowerment costs from an empowerment deal with black investors.
