Premier Group acquires Western Cape’s RFG Holdings in R28bn food sector consolidation
JSE-listed consumer goods company Premier Group has announced a strategic acquisition of fellow South African food producer RFG Holdings through a share-swap transaction valued at approximately R4.3 billion, creating a combined entity with annual revenues approaching R28 billion.
The deal, announced on October 16, offers RFG shareholders one Premier share for every seven RFG shares held, representing a significant 35.6% premium to closing prices and 37.5% premium to 30-day volume-weighted averages. Following completion, RFG shareholders will collectively own 22.5% of the enlarged Premier Group, while RFG will delist from the Johannesburg Stock Exchange.
Strategic rationale and synergies
Premier CEO Kobus Gertenbach described RFG as a “highly attractive acquisition opportunity” with complementary capabilities and limited integration risk. The companies share common customers and sales channels but operate in distinct product categories, minimising operational overlap while maximising synergy potential.
“This transaction allows shareholders from both firms to participate in the growth of a combined entity generating nearly R1.7 billion in after-tax profit,” Gertenbach explained. The deal is expected to unlock significant operational efficiencies while expanding Premier’s market presence across multiple FMCG categories.
The companies
Founded in 1824 and headquartered in Midrand, Premier operates through two divisions: Millbake, producing bread, maize and wheat products, and Groceries and International, covering sugar confectionery, home and personal care goods. The company’s portfolio includes household brands such as Blue Ribbon, BB Bread, Snowflake, Iwisa, Manhattan’s and Lil-Lets, with manufacturing operations spanning 30 facilities across South Africa, Mozambique, Eswatini and Lesotho.
RFG Holdings, established in 1896 in Groot Drakenstein in the Western Cape, specialises in convenience meal solutions with 14 manufacturing plants across South Africa and Eswatini. The company’s portfolio includes Rhodes canned vegetables and juices, Bull Brand, Pakco curry powders, and Man’s Meal ready-to-eat pies, exported to the UK, Europe, US and 13 sub-Saharan African markets.
Track record and market position
Since its JSE listing in March 2023, Premier’s market capitalisation has surged from R6.7 billion to R19.8 billion, delivering a 24.9% return on invested capital while investing R2.8 billion in capital improvements. Premier commands significant market shares: 28% in South African formal bread, 38% in wheat, 15% in sugar confectionery, and 22% in feminine care products.
RFG has completed ten strategic acquisitions since its 2014 JSE listing, systematically expanding its product range and market reach. The company’s senior management will remain in their current roles to ensure operational continuity and maintain customer service standards.
Approval process and market context
The transaction requires RFG shareholder approval and regulatory clearance from competition authorities. Shareholders holding 77.7% of RFG shares have already pledged support, while Premier’s major investors, including Brait and Titan, have also backed the deal.
This acquisition reflects a broader trend of JSE consolidation, particularly among small and mid-cap companies. JSE CEO Leila Fourie recently noted that smaller firms struggle to achieve fair valuations due to limited investor appetite, driving delistings and consolidation activity across the exchange.
