VENTURES: One Man's Meat...
Recent Western Cape Business News
PAARL-based industrial conglomerate KAP International – which is controlled by Cape-based German investor Claas Daun – has flogged its fresh meat business roughly a year after closing down the operation.
The fresh meat division, which formed part of KAP’s well known Bull Brand division, notched up substantial losses in 2009 before being closed down.
It would seem – judging by the amount of time that has lapsed between closure and actual sale – that KAP battled to find a purchaser for the fresh meat business – although two farms associated with the business were sold last year.
The fresh meat business fetched R18 million – which under the circumstances does not seem too unreasonable.
But more interesting is that the entity prepared to fork out R18 million is closely related to KAP. Officially the purchaser is Courtheil Financing, a company owned by Atlas Textilverwaltungs GmbH, a German company of which Claas Daun – the major shareholder in and chairman of KAP – is the sole director.
KAP, in an official statement to shareholders, says the disposal was considered necessary in light of the volatility of earnings of the fresh meat division and the low return on capital invested.
It seems KAP is still satisfied with Bull Brand, which canned meat products include brands like Gants, Spekenham and Apex as well as many house brands and private labels.
Of course, Daun’s willingness to pick up the fresh meat business is somewhat puzzling – especially since KAP had seen fit to shut down the business to preclude further damage to bottom line.
Admittedly Daun has built a reputation for buying sunset industries (especially in the clothing and textile manufacturing line) over the last 15 years. In many instances Daun proved sceptics wrong by turning around ailing operations…even making enviable profits.
But with KAP’s fresh meat business has he perhaps bitten off more than he can chew?
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