Tiger Brands might be able to stop closure of canning facility after finding a potential buyer

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Tiger Brands owns the Koo brand which also produces canned fruit.
Tiger Brands owns the Koo brand which also produces canned fruit.
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  • The Western Cape government has been meeting with Tiger Brands and other stakeholders in a bid to stop the closure of its Langeberg & Ashton Foods canning facility.
  • On Tuesday, the provincial government said Tiger Brands revealed in a meeting that it has begun the process of selling the business.
  • The food producer, whose brands include Koo canned produce, announced the closure of the plant last week, saying the move was part of its plans to exit the business as it continues with its strategic review. 

Tiger Brands may be able to stop the closure of its Langeberg & Ashton Foods (L&AF) canning facility after finding an interested buyer, says the Western Cape government.

On Tuesday, the provincial government said Tiger Brands revealed in a meeting that it has begun the process of selling the business.

"We welcome the news that there are now interested parties engaging with the company. Tiger Brands also made an appeal to other interested parties to come forward," read the government’s statement. 

Both Tiger Brands and the government, as well as other parties, have been meeting to find solutions to the impending closure.

READKoo owner defends possible plant closure after an 'exhaustive' hunt for buyers

The food producer, whose brands include Koo canned produce, announced the possible closure of the plant last week, citing a need to exit the business as it continued strategic review. Tiger Brands also cited industry-wide trade barriers and exchange rate fluctuations as some issues affecting its deciduous business.

But closing the facility means 4 000 jobs would be lost. 

A consortium of 160 farmers had failed to raise the R200 million to R300 million required to take over the facility by the 31 March deadline. Tiger Brands also said its efforts to find a buyer for L&AF fell through.

The JSE-listed company is looking to dispose of the business to owners who will ensure that it continues to operate and people will not lose their jobs.

"For the Western Cape government, ensuring economic growth and job creation is a top priority, and so we have been in regular contact on this matter. This was my second meeting with Tiger Brands, and Wesgro has been in constant contact with them, with the aim of finding a lasting solution," said Western Cape Premier Alan Winde.

The province’s Minister of Agriculture Ivan Meyer said the department is working closely with organised agriculture and other departments.

"I have also written to the National Minister of Agriculture Rural Development and Land Reform, Thoko Didiza, requesting her support in line with the National Department of Agriculture’s Agro-Processing Master Plan," Meyer added.

READ | Tiger Brands whips up a new strategy for its Albany bread business

Cosatu weighed in on the possible closure, slamming Tiger Brands for its decision to close down the canning facility, saying it would spell "disaster" for affected workers.

"The discussions must now focus on making the company more effective and to put together a consortium to buy the company. This consortium must include workers having a substantial stake in the company, that would be equal to the gap between the offer and the asking price, on the table at the moment," Cosatu added.

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