Invenfin, the growth capital subsidiary of diversified investment group Remgro, has acquired a 30 percent stake in Dynamic Commodities, a leading South African producer and exporter of value-added frozen fruit products.
In business for 20 years, Coega-based Dynamic Commodities, located outside Port Elizabeth, has a dynamic line of innovative fruit products, including fruit sorbets, cut frozen fruits, and unique products such as its fruit sorbet in a fruit shell which has been highly successful in the U.S. market under the Island Way brand. All of the company’s products are made from 10 million kilograms of locally sourced fruit per year at its state-of-the-art facility in Coega.
“There is no doubt that the quality of fruit from the Eastern and Western Cape plays an integral role in our reputation for high quality products which we have in our international markets,” Adrian Vardy, CEO of Dynamic Commodities told AgriOrbit. “As a value-adding agri-processor, we work closely with the farming community, and in this way, Dynamic Commodities contributes to the stability and growth of the Eastern Cape’s farming sector.”
The decision to invest in the frozen fruit company was driven by the macro drivers signaling the potential for growth in the segment.
“The current global market for ice-cream alone is $50bn and growing, and the frozen fruit market is also showing exciting growth,” said Stuart Gast, executive director of Invernfin.
News of the investment follows closely after Dynamic announced its intention to double the size of its business over the next three years and the company’s May announcement of a R22 million (US$1.5 million) investment to expand its operations, according to Herald Live.
Invenfin’s strategy is to acquire significant minority stakes in businesses, “so that the owners remain in control and retain their passion and leadership,” said Gast reports Yes Africa.
The 70 percent stake in the company that was not acquired by Remgro will remain with business partners, chief executive Adrian Vardy and Dynamic founder and managing director, Manie Maritz.
The acquisition of a stake in Dynamic Commodities is the second for Invenfin in the food sector this summer. In June of this year, the firm added to its R150 billion (US$10.2 billion) portfolio with the acquisition of a stake in DV Artisan Chocolate.
Noting “significant potential” in the artisan chocolate industry, Invenfin acquired a significant minority stake in the Paarl, South Africa-based company that sources its raw materials directly from African cocoa farmers.
“One of the biggest trends in the confectionary world right now is the bean-to-bar chocolate movement,” InvenFin director Stuart Gast told BD Live.
Gast goes on to explain the attraction for investments in companies such as Dynamic and DV Artisan.
“Specialist companies like DV Artisan are the kind of food and beverage producers we want to support, not only to unlock the potential of their individual businesses, but also to create a worldwide awareness of the spectrum of intimate, original and personally run food and beverages operations in SA.”
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Lynda Kiernan
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