One of the South Africa's best-known brands, Rainbow Chicken, has been listed on the Johannesburg Stock Exchange (JSE), and shares will be traded from July 1.
Listing on the JSE represents a major step for Rainbow Chicken as it becomes a stand-alone company, unbundled from the former parent company, RCL Foods.
Following careful review, the board of South Africa’s consumer goods giant RCL Foods Ltd announced its decision to spin off its vertically integrated poultry division earlier this year.
Since its foundation as a family business in 1960, Rainbow Chicken has grown to become one of the largest poultry companies in South Africa, according to the Johannesburg Stock Exchange (JSE).
A fully vertically integrated poultry producers, the new Rainbow Group operates 165 farms, eight hatcheries, three primary processing plants, and two further processing factories. Furthermore, it owns six feed mills — and the feed brands Epol and Driehoek — and owns a 50% share in a joint venture that operates two waste-to-value facilities under the name “Matzonox.”
To unbundle the poultry business, more than 890 million ordinary shares are on offer, on a one-to-one basis for each share in RCL Foods. Shares will be trading from July 1.
New era for Rainbow Chicken
For Rainbow’s CEO Marthinus Stander, becoming a stand-alone entity is a significant milestone for the new company, according to JSE.
“We aim to re-establish and rebuild our chicken and feed businesses as best-in-class in terms of customer-centricity, delivering value via innovation and leveraging our heritage,” he said. “This bold move heralds a wave of exciting opportunities for growth in both our business and our people. Our commitment to a smooth transition ensures minimal disruption to our operations. We have robust plans to maintain stability and efficiency, continuing our tradition of excellence.
“We look forward to innovative developments in our product offerings, enhanced community initiatives, and a stronger brand presence.”
Joining Stander as executive directors for the new company are Kerry van der Merwe as chief financial officer, and chief operating officer Wouter De Wet.
More on Rainbow Chicken
As part of RCL Foods, the Rainbow Chicken integrated poultry division achieved annual slaughterings of 197 million poultry. This output made it the second largest poultry company, not only in South Africa but on the African continent, according to WATTPoultry.com’s Top Poultry Companies survey.
For the half-year to December 31, 2023, the Rainbow businesses of RCL Foods achieved an operating profit of 112.2 million rand (ZAR; US$6.15 million) from a revenue of just under ZAR7.25 billion. With highly challenging market conditions, the businesses only achieved an operating profit in one of the previous three financial years, despite revenue growth.
However, with revised strategies adopted over the past three years, the new Rainbow Group reports that management has successfully improved the operational resilience of the whole business.
