Food and beverage company PepsiCo South Africa, through its subsidiary Pioneer Foods, will acquire the remaining 50% stake in Futurelife Health Products.
It bought an initial 50% interest in Futurelife Health Products in 2015.
The transaction is expected to close and be effective in the first week of July. The transaction is subject to some administrative conditions precedent, which are standard for a transaction of this nature.
“Futurelife is an innovative brand within the cereals market and we believe its product basket will complement our current portfolio. Upon closing of the transaction, we look forward to welcoming the Futurelife employees into PepsiCo. This will also mean that qualifying employees will be entitled to participate in our employee share ownership scheme, the Basumi Trust,” says PepsiCo South Africa CEO Riaan Heyl.
Paul Saad founded Futurelife in 2007. The proposed transaction will see Pioneer Foods buy his 50% shareholding in Futurelife.
The Competition Commission recommended the conditional approval of the acquisition earlier in May. Its recommendation was considered by the Competition Tribunal, which issued its order to approve the merger on May 29.
The commission found that the transaction does not raise any competition concerns as Pioneer Foods is already in a position of joint control over Futurelife, and Pioneer Foods and Futurelife compete with several large players in the market for ready-to-eat-cereals.
The commission confirmed that the proposed transaction does not raise any public interest concerns that are not addressed through this undertaking which promotes a greater spread of ownership by employees, PepsiCo South Africa says.