South Africa's largest fruit exporter Capespan, is to buy the remaining 50% shares in Capespan International Holdings from Irish food company Total Produce, gaining control of the marketing operation in the U.K. and Europe.

Dublin-based Total Produce and Capespan have been involved in a joint venture for the last decade. Capespan group managing director Johan Dique, said the 13 million euro (US$17 million) acquisition will strengthen the company's position for further growth.

In return, Total Produce will gain 20 million additional shares in the South African parent company and 8.5 million euro (US$9.1 million) in cash.

"The transaction will also increase the shareholding of Total Produce in Capespan, which will enhance the strategic alliance and partnership between the two parties in the fruit industry globally."

The purchase will be settled partly in cash with the issuance of 20 million new shares in Capespan and will need the approval of shareholders as well as the South African Reserve Bank.

Capespan's Europe-based subsidiary was originally set up to distribute South African fruit in Europe but has recently distributed fruit from around the world to European Union retailers.

A Capespan spokesperson said it was logical for the subsidiary to have a single shareholder. Capespan has been the subject of a bidding war this year between its two main shareholders. Zeder Investments, which has a 40% stake, made a bid for the company in June which was followed by an offer from Bidvest, which has an 8% shareholding.

Capespan is a fruit supplier to retailers and wholesalers in 34 countries in the Northern Hemisphere and in 2010 had an operating profit of ZAR108.9 million (US$13.34 million)

Photo: Capespan

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