Tiger Brands, one of South Africa’s largest food producers, has recently announced plans to explore the sale of its chocolate brand, Beacon.
A staple in South Africans’ pantries and sweet cupboards might be on the brink of sale. CFO Thushen Govender reassured its consumers with, “We will continue delivering on the strategic turnaround of the business until such time as an appropriate exit mechanism has been identified,” as quoted by News24.
CEO Tjaart Kruger highlighted the hurdles facing Tiger Brands’ chocolate category, particularly Beacons’ largest competitor, Cadbury. He went on to explain that even though they’ve priced Beacon slabs up to R5 cheaper than Cadbury, the sales volumes aren’t where they’re needed for sustainability.
Additionally, he noted that outdated technology is another huge complication. The company has not modernised their chocolate-making equipment in over 30 years, and this has led to ballooning costs that have now rendered any efforts for modernisation unfeasible.
However, Kruger remains optimistic about Beacon’s future, reassuring consumers that under the right stewardship of a suitable entity, South Africans should still be able to enjoy their favourite slab.
This isn’t a first for Tiger Brands. In their recent strategy to realign the company’s portfolio with its evolving vision, they’ve also announced the sale of its deciduous canned fruit business, Langeberg and Ashton Foods. The sale, made five years after its initial sale announcement, is set to transfer operations to a new company backed by many vested parties, ensuring continuity for the 3,000 employees who rely on their jobs for their livelihoods.
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This article was originally published on cape{town}etc.
