South Africa’s Rainbow Chicken listed on stock exchange

One of South Africa’s best-known brands, Rainbow Chicken, has been listed on the Johannesburg Stock Exchange (JSE) and its shares will start trading from 1 July.

The JSE listing represents a major milestone for Rainbow Chicken as it becomes a standalone company, separate from the former parent company, RCL Foods.

After careful consideration, the board of directors of South African consumer goods giant RCL Foods Ltd has announced its decision to split its vertically integrated poultry division earlier this year.

Since its founding as a family business in 1960, Rainbow Chicken has grown to become one of South Africa’s largest poultry companies, according to the Johannesburg Stock Exchange (JSE).

A fully vertically integrated poultry producer, the new Rainbow Group operates 165 farms, eight hatcheries, three primary processing plants and two further processing plants. In addition, it owns six feed mills – as well as the Epol and Driehoek feed brands – and holds a 50% stake in a joint venture that operates two waste recovery facilities under the name ‘Matzonox’.

To dismantle the poultry business, more than 890 million common shares are being offered, one for one share of RCL Foods. The shares will be traded from July 1.

New era for Rainbow Chicken

Rainbow CEO Marthinus Stander said becoming a standalone entity was an important step for the new company, according to the JSE.

“We aim to restore and rebuild our poultry and feed businesses to be best in class in terms of customer focus, delivering value through innovation and leveraging our heritage,” he said. “This bold initiative heralds a wave of exciting growth opportunities for our company and our employees. Our commitment to a smooth transition ensures minimal disruption to our operations. We have solid plans to maintain stability and efficiency, continuing our tradition of excellence.

“We look forward to seeing innovative developments in our product offering, enhanced community initiatives and a stronger brand presence. »

Joining Stander as executive directors of the new company are Kerry van der Merwe, chief financial officer, and Wouter De Wet, chief operating officer.

Learn more about Rainbow Chicken

As a subsidiary of RCL Foods, the Rainbow Chicken integrated poultry division slaughtered 197 million birds per year. This production makes it the second largest poultry company, not only in South Africa but also on the African continent, according to WATTPoultry.com’s Top Poultry Companies survey.

During the six months ended 31 December 2023, RCL Foods’ Rainbow business made an operating profit of R112.2 million (ZAR; US$6.15 million) on revenue of just under ZAR7.25 billion. In very difficult market conditions, the business achieved an operating profit in only one of the previous three financial years, despite revenue growth.

However, thanks to revised strategies adopted over the past three years, the new Rainbow Group reports that management has managed to improve the operational resilience of the entire business.