New look for Ola Milky Lane

A brand new menu featuring fun icons, colourful close ups of delectable treats and vibrant hero photos have driven the rejuvenation of the Ola Milky Lane brand and its outlets. The makeover started with Fourways, Monte Casino and Eastgate in Johannesburg and Galleria Mall in KwaZulu-Natal and will be rolled out countrywide shortly.
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Foodcorp debt downgraded

Standard & Poor’s Ratings Services said today that it lowered its
long-term corporate credit rating on South African food manufacturer
Foodcorp (Proprietary) Ltd. to ‘B-’ from ‘B’. The outlook is stable.
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SAB gears up for 2010

The South African Breweries (SAB) has outlined details of its preparations to ensure the country is fully stocked and supplied with beer during the forthcoming FIFA World Cup tournament.

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Commission appeals bread cartel penalty

The Competition Commission yesterday lodged an appeal with the Competition Appeal Court against the Competition Tribunal’s earlier ruling on the administrative penalty imposed on Pioneer, for its involvement in the bread cartel.

In this case the Commission alleged that Pioneer Foods, which owns Sasko and Duens bakeries, together with Tiger Brands, Foodcorp and Premier Foods colluded to increase the price of bread. Premier was granted leniency in exchange for its cooperation with the Commission, while Tiger and Foodcorp settled their cases, admitted the conduct and paid administrative penalties.

The Commission proceeded with the case against Pioneer and asked the Tribunal to impose a penalty of 10% of the Pioneer group turnover for 2006. Following a hearing, the Tribunal found that Pioneer had indeed colluded with fellow bakeries to fix the selling price of bread and to allocate markets amongst themselves. In its finding, the Tribunal noted that cartels are the most egregious offences in competition law, that poor consumers were particularly affected and that, absent mitigating factors, cartels deserved the maximum penalty provided in law. The Tribunal also concluded that Pioneers defence was premised on manifest falsehoods. The Tribunal then imposed a penalty of R195 million, being 10% of Pioneer Foods baking division’s turnover for 2006, rather than its group turnover.

The Commission welcomes the findings of the Tribunal on the facts, namely that Pioneer had engaged in cartel behaviour, but does not believe that the criteria prescribed by the Tribunal to determine the penalty are appropriate to deter cartel behaviour.

“While the Tribunal judgment appropriately castigates this cartel behaviour, we are not happy with the manner in which it calculated the penalty. Administrative fines must be set at levels that effectively deter anti-competitive behaviour. We believe that the precedent set by this ruling will negatively affect the Commission’s ability to set effective fines in future cases” says Commissioner Shan Ramburuth.

The Commission has asked the appeal court to reverse the Tribunal’s finding on the penalty and impose a penalty of 10% of Pioneer’s group turnover, which would amount to approximately R1,5bn.

SAB Zenzele Transaction clinches DealMakers Deal of the Year Award

The South African Breweries Ltd (SAB) is delighted to have been awarded DealMakers magazine “Deal of the Year” award for its Zenzele black economic empowerment transaction. The publication announced their annual rankings and award winners for 2009 at its annual banquet in Sandton on Wednesday evening, 24 February.

The R7.3-billion Zenzele broad-based BEE deal was one of fourteen deals short-listed for this award category which were judged by an independent panel led by Professor Mthuli Ncube, Dean of the Commerce Faculty at the University of the Witwatersrand.

SAB Zenzele was first announced on 1 July 2009 and will ultimately place 8.45% of the company’s shares under black ownership.

Transaction participants include SAB employees, qualifying black-owned liquor and soft drink retailers, and a new SAB Foundation. After the ten-year transaction period, SAB Zenzele shares will be exchanged for SABMiller shares. The transaction will equate to an effective 14.1% BBBEE transaction in terms of the BBBEE Codes of Good Practice.

SAB MD Norman Adami says: “We are honoured to have received this award which recognizes our goal of delivering a broad-based empowerment transaction which is both innovative and distinctive.”

“The award clearly demonstrates one of our key values in action, namely that we work and win in teams. A multi-disciplinary team representing all functions across the business has worked on our Zenzele transaction and I am very proud of all the team players. We are now focused on ensuring it is successfully implemented,” he says

This week, the retailer component of Zenzele opened for participation by retailers.

The offer is scheduled to close on 7 April 2010 and will be implemented in May 2010.

Several factors make the Zenzele transaction distinctive, including that:

-      The benefits of the deal are targeted at key stakeholder groups who play a meaningful role in the long term business success of SAB and its soft drinks division ABI;

-      No external bank funding is required;

-      A meaningful bi-annual cash dividend is expected to be paid from year one; and

-      The transaction is affordable and easily accessible – qualifying retailers will make only a small cash investment.

The fact that Zenzele also acts as an incentive for beer and other liquor retailers to become licensed is a key societal benefit and in keeping with SAB’s belief that the liquor industry as a whole can only become sustainable once it has been normalised.

Participants will, from inception, have voting and economic rights in SAB, and bi-annual cash dividends are expected to be paid to all participants from year one for the whole of the ten-year transaction period.

Nampak Flexible shows world class at FTA International Awards

Nampak Flexible, Southern Africa’s leading flexible packaging supplier, received two award nominations for their Imana Chicken Noodle soup and Imana Cream of vegetable soup packs entered into the 2010 FTA (Flexographic Technical Association) International Awards.
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ISO gives food manufacturers new tool to control hazards

Thousands of food manufacturers worldwide stand to benefit from a newly published document in the ISO 22000 series designed to prevent and control food safety hazards.

ISO technical specification ISO/TS 22002-1:2009, Prerequisite programmes on food safety – Part 1: Food manufacturing, sets out requirements for prerequisite programmes needed to realize safe products and provide food that is safe for human consumption. It is intended to be used in conjunction with, and to support, ISO 22000:2005 which gives requirements for a food safety management system.
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Pioneer: Doing itself no favours

Pioneer Food Group and its bread business are doing itself no favours by continuing its battle with the Competition Tribunal over bread price fixing.

On Wednesday the Tribunal announced that it was imposing a fine of R195m on the food group which comprised R46 019 954 which is 9.5% of the turnover for the bread business in the Western Cape and another R149 698 660 which is 10% of the total Pioneer Food Group revenue.

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Africa must embrace crop protection technology

DuPont, the global leaders of market-driven science, says that farmers and governments in sub-Saharan Africa urgently need to embrace the scientific developments made in enhancing crop yields and protection, if it is to avert a growing food shortage crisis.
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Ububele – investment analyst presentation feedback

Earlier this week investment analysts were invited to attend a presentation by the management of Ububele Holdings Limited, the agri-business and processor which is headed for the AltX later this year. ManufacturingHub.co.za provides feedback on the presentation and some views on the offering.
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