Legacy Africa invests in South African food manufacturing and packing company
Legacy Africa Capital Partners (LACP) has acquired a significant minority stake in South African contract food manufacturing and packing company Kelpack Manufacturing. The investment from the Legacy Africa Capital Partners Fund I (LACP Fund I), is anticipated to assist the Pinetown-based business to capitalise on the growth potential afforded by its strategic position close to the Port of Durban as well as its solid existing customer base and international certifications.
The transaction also provided debt funding for a management buy-in of an additional 22%. A new management team has been established, which includes newly appointed CEO Patrick Sithole, along with two current Kelpack Manufacturing employees. This kicks off a leadership handover from current CEO Garth Jones to Sithole, with Jones retaining a board seat. Sithole comes with a wealth of experience and expertise, having held various senior and executive management roles in the manufacturing and supply chain sectors over the last 30 years with companies such as Unilever and Tiger Brands.
“Kelpack Manufacturing is proud to announce its partnership with Legacy Africa Capital Partners, which will enable the company to transition from Level 2 BEE compliance to Level 1,” says Jones. “Kelpack is now a truly South African black-owned, black-run company employing 600 people with blue chip multinational food companies as its customers.”
Kelpack offers a full-service solution; it manufactures food products on behalf of the client, and packs and supplies it according to the agreed quantity and date of delivery. Its packaging capabilities include portion packs such as single-serving butter and condiments; liquid filling for items such as honey and tomato sauce; sachets, strip packs, bulk packs and pouches, all for powdered products; and tubs and canisters for seasoning and spices.
Companies such as Bokomo, Tiger Brands, KFC and Bidvest are currently among its clients. With the transformed management team at the helm, the company’s B-BBEE credentials will unlock a new potential client base. This could lead to faster growth and, ultimately, more employment opportunities.
LACP is a highly regarded South Africa-based private equity firm. It is a key supporter of small- and medium-sized enterprises in Africa and seeks opportunities in segments often overlooked by traditional large financial institutions. The firm manages the LACP Fund I, which has a diverse portfolio of investments including Lonsa Everite, Swartland, Penflex, CPA and TQ Group.
“We are excited to partner with Kelpack and its strong management team,” says Boitumelo Mashilane, Principal at LACP. “We were particularly attracted to Kelpack because of its strong offering to blue chip multinational companies as well as the opportunity in building a strong core black management team in Kelpack, unlocking huge potential for the business.”
Sithole adds, “I’m thrilled to be a part of the Kelpack family and appreciative of the welcoming atmosphere I have enjoyed from top leadership as well as staff. I’m excited for a future in which we will grow our domestic footprint through our new alliance, by strengthening our customer relationships, creating exciting new products, and continuing to offer our high-quality products to the market.”
Part of the shareholding was acquired from One Africa Capital and FyreFem Fund Managers, which invested in Kelpack in 2020. “We are pleased that we have been able to contribute to the track record of women-owned and managed fund managers, which will benefit from a successful exit,” commented Yvonne Maitin and Cathy Goddard, of One Africa Capital and FyreFem, respectively.
About Kelpack Manufacturing
Kelpack Manufacturing is a South African provider of contract food manufacturing and packing services to the fast-moving consumer goods industry. The company was founded in 1996 and has its headquarters in Pinetown outside Durban, South Africa. It specialises in high-volume, multi-unit food manufacturing, adhering to the strictest food safety standards and helping customers avail services at a competitive price.
About Legacy Africa Capital Partners
Legacy Africa Capital Partners (LACP) was founded in September 2018 and is a private equity fund management business. LACP is the manager of Legacy Africa Capital Partners Fund I and is part of Legacy Africa Fund Managers. LACP is a 100% black-owned and managed company comprising a team of deal principals with a long history of private equity investing. The firm seeks to provide capital to entrepreneurial, unlisted companies seeking expansion or buy-out capital to introduce black shareholding to drive growth.
https://legacyafrica.co.za/private-equity/
For enquiries, contact Boitumelo Mashilane at boitumelo@legacyafrica.co.za.