LOOMING SNAG TO A DREAM DEAL
Playing chicken: another twist to the Sovereign deal
The future seems bright for the firm, but the outbreak of bird flu at its Uitenhage plant poses a risk
After two years of battling with truculent minority shareholders and a hostile bidder, poultry company Sovereign Foods appears to have pulled off a deal that leaves almost everyone better off. In what has been described by one analyst as management buyout by stealth, Sovereign shareholders are being offered a price (R12) by management that few would have dreamt possible at any stage during the past two years. The battle kicked off at the Sovereign annual general meeting in August 2015 when a group of shareholders balked at the exceptionally generous remuneration being awarded to what they believed was an underperforming executive team. Things were made worse by a proposed BEE deal that would have ended up putting control of the company in their hands. If all goes well for the soon-to-be-delisted Sovereign bidder, that executive team will end up in control, and Country Bird Holdings might regret the paltry R9/share offer that it made. The outlook for the local poultry industry is con...
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