daniel chigunwe
Rainbow Chicken, a poultry firm backed by South African billionaire Johann Rupert, rose on its debut on the Johannesburg stock exchange Wednesday, valuing the company at about US$396 million.
RCL Foods, controlled by Rupert’s Remgro, unbundled its chicken business. Rainbow’s 890,3 million shares traded at R3,60 apiece by 9:39 a.m. in Johannesburg, up from the listing price of R2,85 and valuing the firm at some R7.2 billion (US$396 million).
“The intent is to have a purely agri-business, that will or should extract better value,” Rainbow Chicken Chief Executive Officer Marthinus Stander said in an interview.
The listing — the third for Africa’s biggest bourse this year — shows nascent signs of investor interest in an economy that’s stagnated for years. The JSE lured just three companies in the past five years before Transaction Capital’s used-car business, WeBuyCars, sold shares in an initial public offering in April. Companies are re-looking at their listing plans after the May 29 election led to optimism that a government of national unity will focus on reviving the moribund economy.
“We are on a good sentiment now post-election and the markets are indicating so,” said JSE Director of Capital Markets Valdene Reddy. “It’s real buoyant markets in both our equities and debt markets.” Cilo Cybin Holdings, a South African medical cannabis company, listed on the JSE’s AltX platform for small and medium enterprises earlier this week. Rainbow Chicken recapitalised with a convertible loan, and an additional R300 million from shareholders, and has managed to lower its costs, add new chicken breeds, and is investing in additional equipment to boost volumes, Stander said. – Bloomberg
Online Reporter