Durban - Tiger Brands, the listed fast-moving consumer goods group, has bought beverage brands Oros, Energade, Hall's, Monis and Roses in a R1.16 billion acquisition of Bromor Foods from Cadbury Schweppes.
Neil Brimacombe, Tiger's managing executive for snacks, treats and beverages, said: "The acquisition is very complementary to Tiger's existing small beverage interests, which include Bioplus and Fast Forward."
He said the strong Bromor brands Tiger had acquired would "provide a huge opportunity to leverage off these brands".
Tiger would look for synergies between the two businesses but the issue of staffing still needed to be addressed.
The deal is subject to competition authorities' approval. The hearing on this deal is likely to be in the second half of the year.
Bromor, which has manufacturing facilities in Gauteng, Durban and Cape Town, generates turnover of R850 million a year.
In 2005 Cadbury Schweppes began disposing of non-core businesses but remains focused on its South African confectionery business, which last year posted a strong performance.
It recently acquired chewing gum brands Stimorol and Dirol, which are sold predominately in the South African market, through the purchase of Dan Products, a Botswana business.
Cadbury has sold its European beverage business, raising a net £1.15 billion (R12.4 billion). It has also sold or intends to sell German confectionery business Piasten and US beverage brands Grandma's Molasses and Holland House. Cadbury expected that these sales, along with the disposal of Bromor Foods, would raise between £350 million and £400 million by 2007.
The proceeds would be used to strengthen Cadbury's position in "priority and emerging markets through acquisition and capital investment and to increase the funding of our defined benefit pension schemes".
Bromor brands will be incorporated into Tiger's snacks and sweets business, which includes chocolate and sugar confectionery.
One analyst, who declined to be named, said the purchase of Bromor brands, which includes sports drink Energade, would complement Tiger's existing energy drinks. The beverage brands Tiger had acquired were considered leading brands in their categories, the analyst said.
Yesterday Tiger's share price lost R1.70 to R172.80. The food producers and processors sector was down 0.18 percent.