Sasko bread. Picture: SUPPLIED
Sasko bread. Picture: SUPPLIED

Shareholders of Pioneer Foods, the owner of brands such as Sasko bread and Ceres juices, have voted almost unanimously in favour of delisting the company, after a $1.7bn bid by PepsiCo.

Pioneer said in a statement on Tuesday that shareholders constituting 99.57% of ordinary shares and 100% of class A ordinary shares have approved the deal, which is subject to approval by competition authorities.

Shareholders of agriculture-focused investment firm Zeder, which has a 28.6% interest in Pioneer, had approved the transaction in September.

Zeder said on Tuesday last week it might return as much as R4.75bn to shareholders after the planned disposal of the Pioneer stake. The Pioneer interest is Zeder’s largest investment, representing 51.2% of its R12bn portfolio.

Analyst Chris Logan of Opportune Investments said the Pioneer shareholders’ approval of the deal was expected.

He said the transaction “unlocks a lot of value” for Pioneer shareholders because the offer consideration of R110 per Pioneer share represents a 56.5% premium to the trading price before the Pepsi bid. The offer consideration is also at a premium to the most likely value of R107 as determined by the independent expert.

Logan said the shareholders’ nod was also understandable because SA’s food stocks have become “value traps” and are not generating returns.

The JSE food producers’ index is down 12.9% since the beginning of 2019, while the all share index has gained 5.38%. In the same period, Pioneer has risen 27.09%.

Pioneer’s share price was little changed at R107.30 on Tuesday, while Zeder, which has a market capitalisation of R7.8bn, gained 0.22% to R4.55.

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