Quantum Foods subsidiary buys Eastern Cape feed mill
A subsidiary of JSE-listed Quantum Foods Holdings will acquire the Olifantskop feed mill, in the Eastern Cape, from Olifantskop Feeds for more than R40-million.
The mill produces animal feed for supply to livestock farmers in the province.
Quantum Foods would acquire Olifantskop Feeds’ fixed assets, goodwill and property associated with the business, including stock but not any other working capital.
It would also take over certain finance leases, all permanent employees and select contracts; however, it would not take over any other liabilities or any brands.
The acquisition supported Quantum Foods’ strategy to grow external feed sales volumes.
It further allowed Quantum Foods to enter the animal feed market in the Eastern Cape, which could not be supplied from its feed mill in George. Sales following the acquisition would be made under Quantum’s Nova brand.
The purchase consideration for the fixed assets, property and goodwill was R41-million. The value of stock would be determined at the effective date and would be acquired at cost, but was estimated to be R6-million.
The acquisition was subject to suspensive conditions.
TRADING STATEMENT
Quantum Foods on Wednesday also released a trading statement, informing shareholders that its earnings a share for the financial year ended September 30, were expected to be a minimum of 50c – an increase of 1 473% on the earnings a share recorded in the previous corresponding period.
Further, headline earnings a share would be a minimum of 49.4c, representing a minimum year-on-year increase of 343%.
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