SOUTH AFRICA – Tiger Brands Limited, a South African packaged goods company, has decided to extend the operations of Langeberg & Ashton Foods (L&AF) for another season despite having plans of divesting the canning factory.

The decision was reached after a consultative meeting with organized labor, L&AF employees, and members of the Canning Fruit Producers Association.

Tiger Brands will continue to engage with interested parties toward executing a transaction that could provide for the continuation of a sustainable, deciduous fruit processing operation beyond the 2022/3 season.

People familiar with the development said the company’s choice to undertake the significant risk required to operate the business for the forthcoming season is much to the relief of broadly affected groups in the Western Cape.

Eyewitness News quotes Canning Fruit Producers Association chairperson Jacques Jordaan as saying that the decision to delay the closures for one more season has lifted the spirits of farmers and farmworkers.

“From our side, I think we are relieved that there is another season. That Tiger is willing to continue with the business and we don’t have the distressful situation of one year ago. I think that we are happy that there is interest in the business, and if there’s interest, I think there’s hope.”

Jordaan added that the canned fruit farming business should soon be in a better position because the markets are doing well internationally.

“With the weaker rand, we have some tailwinds in this aspect, so I think in general, canning fruit exports should be in a better position with the weaker rand.” However, Jordaan said there are still feelings of uncertainty among farmers and farm workers.

The JSE-listed company reaffirmed its intention of selling the deciduous fruit factory when it released its interim financial results for the period ended 31 March 2023.

In June 2022, Tiger Brands commenced consultations and engagements on the future of the business in the absence of any reasonable prospects of a viable transaction at the end of an exhaustive two-year process.

Noel Doyle, Tiger Brands’ chief executive officer indicated that the flexibility, open-mindedness, and good faith shown by all parties in reaching this compact will allow for the rigorous exploration of any new proposals in respect of the Company’s deciduous fruit processing operations while securing the jobs of 250 permanent employees and 4,300 seasonal workers directly employed by L&AF for a further season.

“While the processing and marketing of deciduous fruit remain subject to the vagaries of weather, exchange rates, and global pricing dynamics, the compact meaningfully contributes to mitigating the risk of significant operating losses in the forthcoming season,” he concluded.

Based in the Western Cape, the Langeberg & Ashton Foods Division produces canned fruit (peaches, pears, apricots, apples, and guavas) and fruit purees largely for the export market.

It also supplies Tiger Brands’ Culinary division (canned fruit under the Koo brand, pulps for All Gold and Hugo’s jam, and Koo Baked Beans) and the Baby category (purees for Purity).

Of the canned fruit and puree products, 85% are exported to markets that include Europe, China, Australia, and Japan.

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