UPDATE 1-S.Africa's Tiger Brands to sell processed meats business for $24.7 mln
JOHANNESBURG, Aug 17 (Reuters) - South African food producer Tiger Brands TBSJ.J will sell its processed meats business through two separate deals for a combined 428 million rand ($24.7 million), it said on Monday.
The disposal of the business, which was closed temporarily in 2018 after the world's biggest listeriosis outbreak, is part of a strategic review initiated before that outbreak and concluded that the business was "not an ideal fit" within the group's portfolio.
Molare Proprietary Limited will buy the abattoir business at Olifantsfontein while the meat processing factories at Germiston, Polokwane and Pretoria will be acquired by Silver Blade Abattoir Proprietary Limited, a wholly-owned subsidiary of Country Bird Holdings, Tiger Brands said.
Molare, one of South Africa's largest piggery businesses and one of the main suppliers to the abattoir operation, will pay 117 million rand for its acquisition while Silver Blade will pay 311 million rand for the factories.
"One of the major outcomes we would have achieved by selling the businesses as going concerns is that the jobs of almost 1,000 employees will be safeguarded," said Tiger Brands Chief Executive Noel Doyle.
The company is facing a class action lawsuit over its role in the listeriosis outbreak, which killed more than 200 people in South Africa and was traced back to a factory run by Tiger Brands-owned Enterprise Foods.
Tiger Brands said that any potential liability under the class action will not transfer to the new owners.
As part of the agreements, the company indemnifies the purchasers against any potential liability that may arise on conclusion of the legal process, Tiger Brands said. ($1 = 17.3430 rand)
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