The Central Bottling Company Ltd. (Coca Cola Israel) is nearing completion of the deal to buy South African food company Clover Industries. Clover's board approved the deal after shareholders supported it by an overwhelming majority - more than 99% in favor.
Clover Industries deals mainly in dairy products and beverages. It employs some 8,000 people and has thirteen plants around South Africa.
The takeover deal now awaits regulatory approval in South Africa, among other things from the Competition Commission of South Africa, whose examination could take several months. According to the timetable sent to shareholders at the end of February, from May 15 Clover Industries will no longer be traded on the Johannesburg Stock Exchange or the Namibian Stock Exchange.
Meanwhile, South African company Brimstone, one of The Central Bottling Company's partners in the deal, is still reviewing its participation. A week after the bid was made, Brimstone withdrew because of public anger generated by pressure from opponents of the deal, headed by the BDS (Boycott, Divestment and Sanctions) organization in South Africa, which advocates for economic and other measures against Israel, and which threatened to boycott the South African food company because of the involvement of an Israeli company in the takeover consortium.
If Brimstone does decide to exit from the deal, it will be required to find a replacement to buy its share, and to obtain the consent of the other partners, among them The Central Bottling Company.
In February, The Central Bottling Company, controlled by David Wertheim, made a bid, together with partners, to buy Clover Industries in a deal valuing it at $359 million (NIS 1.3 billion), which constituted a 25% premium on the company's market cap before the deal was announced.
Central Bottling Company's share of the acquisition group is 60%, meaning that it will own 60% of the South African company's shares, worth $215 million (NIS 780 million) at the time the deal was announced. A number of funds are also involved in the deal, together with parties in Clover's management, who also hold shares in the company.
The Central Bottling Company, controlled by David Wertheim, is the fourth largest manufacturer of consumer products in Israel. It owns a number leading brands, headed by Coca Cola Israel, Tara Dairy, and other beer and soft drink brands. The deal will be conducted through the company's overseas arm, which has operated in a number of companies since the 1990s, including in Romania, Turkey, and Uzbekistan.
Published by Globes, Israel business news - en.globes.co.il - on April 8, 2019
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