Kleoss exits South Africa's Real Foods

Kleoss Fund I announced its full exit from South African health and wellness food group, Real Foods.

Kleoss Fund I partially exited Real Foods in March 2022 when Real Foods sold the Kauai and Nu Health Group of quick service restaurants (QSRs) to the Virgin Active Group. A full exit has now been realised through a recapitalisation of Real Foods, by Rand Merchant Bank (RMB), Network Investment Partners, and certain other existing and new family offices and private investors.

Real Foods was created in 2013 to consolidate health-focused food producers and retailers in South Africa. Kleoss Fund I was an early investor in Real Foods when it owned only Kauai and the Nu Health group with a total of approximately 150 QSRs. With Kleoss’ involvement, Real Foods was positioned as a new and improved brand concept for high growth in South Africa and internationally. Kauai successfully expanded into Europe and Asia in addition to distributing Kauai branded products to retail chain stores in South Africa. At the time of Kleoss Fund I’s exit, Real Foods had more than 200 QSRs, a 30% growth since Kleoss Fund I’s investment was made.

With Kleoss Fund I’s investment, Real Foods was able to acquire a controlling interest in Highveld Honey Farms, the largest honey manufacturer and distributor in South Africa and various other health food manufacturers and distributors.

Zain Laher, partner at Kleoss Capital adds, ”The transaction positions Real Foods to maintain its impressive growth rate and maintain its position in the South African health food and wellness sector, which is expected to grow at a compound annual growth rate of around 7% over the next five years. Retailers are expected to continue to increase their healthy food brand and product portfolio to meet growing consumer demand.”

Hale Matsipa, managing partner at Kleoss Capital adds, ”Real Foods was an early and important investment for Kleoss Fund I. We are pleased to have partnered with a high-calibre management team that was able to achieve significant growth over a relatively short period of time and through a challenging economic environment that included the Covid-19 pandemic. We are privileged to have partnered with strong and like-minded investment partners, Parktown Capital, Calculus Capital, and Dean Kaworski. We wish the new investors in Real Foods success for the next stage of this exciting company’s lifecycle.”