21 Jan Old Mutual buys big stake in In2Food

The asset manager had paid between R200m and R600m for a “significant minority stake” in the company that makes private-label products for grocery chains, Jacci Myburgh, Old Mutual’s head of private equity, said. He said he could not be more specific because of confidentiality agreements.

The investment took spending by Old Mutual’s R4bn Fund IV to just beyond the halfway mark, Myburgh said.

The deal follows the purchase last month of a majority stake in MoreCorp, SA’s largest golf-equipment retailer, as the unit focuses on an expanding higher-end consumer class. Old Mutual has already profited from the food industry, buying and selling stakes in Foodcorp and Libstar.

A further attraction of In2Food was the management team led by CEO Richard Cooper, who had 30 years of consumer industry experience, Myburgh said.

The food company, which already sells to the UK, should benefit as a weaker rand boosted exports, even as a severe drought drove up production costs, he said.

“The sector will benefit from a tailwind driven primarily by a cash-rich, but time-poor and health-conscious consumer,” Mohsin Cajee, a private equity investment principal, said.

In2Food was founded in Johannesburg in 2007 and employs 4 000 people in production plants across the country. It sells items ranging from packaged produce to soups and pizzas, according to its website.

In2Food’s operations

In2food Boksburg, previously known as Interfruit, has four factories on site.

• The Produce factory is a high care facility producing chilled prepared vegetables and salads and is Halaal certified. It processes up to 30 tonnes of fresh produce a day.
• The Prepared Foods factory produces chilled prepared salads, soups and meal solutions.
• The Snacks factory produces a range of snacks including hand cooked potato crisps.
• The long life factory produces a range of shelf stable soups and sauces

In2food Strand, previously known as Lombardi Foods has two factories on site.

• The Produce factory is a high care facility producing chilled prepared vegetables and salads, as well as a full range of ready to eat sandwiches.
• The Prepared Foods factory is a high care facility that produces a comprehensive range of convenience foods, including; salads, pizzas, meal solutions, soups and snacking items. It is well invested in the latest equipment to offer an unparalleled food processing capability for SA.

In2food Somerset West

• The juice factory produces a full range fresh juices and nectars.

In2food Uitzicht, previously known as Hydrotec

• Uitzicht, Gauteng, is a major supplier of salad leaf products. 2012 saw the installation of a new state-of-the-art preparation and processing line.

Tropical Fresh, Brazil

• Tropical Fresh produces fresh and frozen cut fruit for customers in Brazil, UK, USA and Canada. There are two factories on site that are capable of ripening, cutting and packing the extensive range of fruits available in Brazil.

In2food Spring Valley

• This facility produces a full range of fresh prepared fruit products that are served chilled in South Africa as well as for exportation.
• Furthermore, Spring Valley processes large quantities of avocado products for the export market.

In2food Compass

• Compass bakery in Kommetjie, Cape Town, makes ambient cake products, as well as a wide range of biscuits. Significant investment has been made over the years in line with first class bakery technology and standards.

In2juice Newport

• Newport in Johannesburg produces a full range of juices and nectars for the Gauteng and KZN regions.

In2juice Western Cape

• The Montague Gardens facility specialises in freshly squeezed juices and has recently started manufacturing shelf-stable, hot-fill juice. It operates under the name House of Juice.
• The Somerset West facility processes only fresh juice and nectars.

Source: BDLive.co.za; www.in2food.co.za