NEWS
Every drop of Brian Joffe
Inhle Beverages in targeted acquisition
Long4Life has concluded a share purchase agreement to acquire 100 per cent of Inhle Beverages (Inhle), subject to the completion of a due diligence and obtaining certain regulatory approvals. INHLE IS A well-established contract packaging business located in Heidelberg, Gauteng. It specialises in the canning and bottling of carbonated soft drinks, energy beverages and natural mineral water using cans and PET. The company was established in 2003 with one production line. Today it is the second largest beverage co-packaging business in South Africa, with seven production lines and considerable scope for expansion. The company employs around 300 staff and undertakes co-packaging on behalf of an established client base. Long4Life chief executive Brian Joffe comments, ‘This acquisition fulfils the broad definition of our investment criteria in the leisure space. It presents a strategic opportunity from which we can build a beverage business of scale, through both organic growth and bolt-on acquisitions. Immediate access to the largest market in the country as well as its proximity to surrounding territories, positions Inhle extremely well from an expansionary point of view.’ Inhle recently secured a liquor licence (for packaging purposes), which represents
another industry opportunity for Long4Life to expand its interests in this sector. The co-packaging on behalf of Inhle’s clients will initially be focused on canned, already-mixed beverage products, which has seen strong growth over the last few years. Inhle director Chris Botha explains, ‘The overriding benefit of this acquisition is that it positions Inhle for its next exciting growth chapter. As a family-owned business we have certain constraints, but by partnering with Long4Life we can access its funding capability, and the vast entrepreneurial knowledge and experience of its team. This allows us to better position ourselves and take advantage of the significant opportunity that exists in the rapidly growing beverage industry in South Africa.’ The concept of co-packaging on behalf of beverage manufacturers is a growing international trend, which ultimately reduces risk for the packaging supplier. Long4Life’s chief operating officer, Kevin Hedderwick concludes, ‘We recognise the value of entering a market with a partner that is already well-known and highly regarded in the industry.’
water counts
THE WESTERN CAPE has been declared a disaster area as South Africa experiences its worst drought in 30 years. ‘Corporate South Africa, government and the public need to make a collective effort to safeguard this essential resource,’ says Nico Moloto, stakeholder and sustainability manager at Pioneer Foods. To mitigate against potential water-related risks, Pioneer underwent a group-wide basic water assessment in October 2015. The geographical and catchment area risks for each production plant were assessed and site-specific water consumption figures recorded. By the end of 2016, Pioneer managed to save approximately 86 million litres of water in total across all its sites. The company identified the potential to improve water consumption across the production process, particularly in beverage plants. In addition to the supplementary use of borehole water at the Ceres Beverages site backwashing water is recovered and reused, while new pumps regulate water pressure more efficiently. The Ceres Beverages factory in Gauteng is close to achieving a 20 percent saving in the amount of water per one litre beverage produced. This is thanks to more efficient processes and the capture and re-use of water used on the seals and pasteuriser pumps. Up to 80 per cent of the water used in each backwash is now recovered and reused since an improvement project was recently completed. •
No agreement of sugar tax yet, says BevSA
THE BEVERAGE ASSOCIATION of South Africa has dismissed reports that there was an agreement on the Health Promotion Levy at the National Economic Development and Labour Council (Nedlac). BevSA is opposing the introduction of a 20 per cent tax on sugary beverages, or what has been referred to as sugar tax, which government wants to implement in a bid to curb noncommunicable diseases. Mapule Ncanywa,
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Food Review | September 2017
BevSA executive director, said the industry still believes that the levy in its current form would have serious negative impacts on the economy, and have no impact on the non-communicable diseases problem. He reiterated that the primary aim of the industry was to avoid any job losses particularly under the current economic conditions, which is faced with a technical recession and credit rating downgrades
and have an impact on health. ‘BevSA welcomes the continuation of the engagements and hopes that all efforts will be explored on finding a solution that addresses concerns raised by industry and other stakeholders,’ Ncanywa said.