R&R Ice Cream buys Nestlé South Africa outfit

By Rod Addy

- Last updated on GMT

R&R's products include Rowntree's Fruit Pastille ice lollies
R&R's products include Rowntree's Fruit Pastille ice lollies

Related tags Ice cream Africa

R&R Ice Cream has acquired Nestlé South Africa’s ice cream business, boosting its international expansion plans.

Nestlé’s South African branded portfolio includes names such as Dairymaid, Country Fresh, Eskimo Pie and King Cone as well as Rolo and KitKat.

The business has a modern manufacturing facility with nine production lines at Clayville, Johannesburg and 200 full time employees. It owns 22,000 freezers and operates through a network of 14 distributors in South Africa and across the sub-Saharan region.

The ice cream sector in the region has enjoyed good growth which is forecast to continue. It was worth approximately R2.1bn (£115M) in 2013, with impulse purchases generating half of those sales and take-home spend generating the other half.

Nestlé Ice Cream’s existing South African management team would continue to drive the business locally and contribute to R&R’s broader global strategy, it said.

‘Major milestone’

“This acquisition is a major milestone towards our goal of becoming a leading global player in ice cream,”​ said R&R ceo Ibrahim Najafi. “As a business we have enjoyed a successful partnership with Nestlé for nearly 15 years in the UK.

“This relationship was extended with the acquisition of Peters ​[Food Group] in Australia ​[in May 2014], also a former Nestlé business, and now we are looking forward to working together in South Africa.

“We also believe that African ice cream consumption will continue to increase as consumers become more affluent and we see this acquisition as a springboard to grow sales across much of the African continent.”

R&R now claims to be the third largest ice cream manufacturer in the world, producing an attractive portfolio of branded and own-label products with annual sales approaching €1bn (£707.3M).

‘From strength to strength’

The company is owned by funds managed or advised by PAI Partners. Colm O’Sullivan, partner at PAI, said: “R&R continues to go from strength to strength and we are very pleased with its development under our ownership, over the last two years.

“The African ice cream market represents an attractive long-term growth opportunity for R&R and we look forward to working with Nestlé Ice Cream’s team in South Africa.”

The terms of the deal remain undisclosed and are subject to the approval of the South African Competition Commission. 

R&R’s Nestlé products include Fruit Pastilles, Fab ice lollies and Smarties cones.

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