Fast moving consumer goods firm PRObrands has through its Prodairy Unit acquired Revive juice which shut shop in 2016 and the company has since resumed production with the juices already commanding 15% market share.
By Melody Chikono
Revive juice was previously a joint venture between Bedra Beverages and Innscor Africa Ltd and the acquisition is aimed at consolidating operations and achievinggrowth trajectory in 2018.
Bedra Beverages stopped producing the drink due to undisclosed challenges which contributed to the total closure of the company.
PRObrands financial director Nqobani Mthethwa told businessdigest on the side-lines of a Prodairy plant tour last week that the acquisition is under a royalty agreement whereby Bedra will receive proceeds as a percentage of total sales.
“We are part of the Innscor group. Revive was being produced by another Innscor associate, Bedra Beverages, which has since stopped operations due to a number of challenges and then we acquired it under PRObrands. Due to the relationship we have through Innscor we were able to acquired Bedra under a royalty agreement. We will be paying royalty based on a percentage of sales,” he said.
Revive capacity utilisation is seen at 100% by year end from the current 40% buoyed by a separate investment that will be poured into a new Revive line.
“Revive is at 40% at year-end, we see it at 100% as we are going to be investing in a separate line to produce Revive which production capacity is being shared by Sterimilk. The machinery will be dedicated to the sake of producing Revive,” he said.
Mthethwa said the company’s focus this year is the consolidation of operations for growth and securing its raw milk.
Prodairy, has invested US$1,6 million in one of its farming projects, which will see its operating capacity hitting 75% by year end.
Prodairy, a subsidiary of PRObrands, partnered foreign private equity firm Subsahara Capital and Sean Webster, a consultant, last month to boost its Mafuro Farming project.
The company has the capacity to produce three million litres of its daily products per month, but is only operating at 55% capacity and generating 1,5 million to 1,6 million litres from 700 000 litres of raw milk.
“This year we will focus on consolidating and growing what we have got. In terms of product range we are not looking at expanding the product range, I think what is key is to secure our raw milk from the Mafuro initiative. Once we are done consolidating and increasing the growth of what we have got, we will start looking at other new ventures,” he said.
Mthethwa said PRObrands is strong at the moment and outlook is positive, buoyed by its relationship with Innscor.