S. Africa's Del Monte eyes RI acquisitions

S. Africa's Del Monte eyes RI acquisitions

BANGKOK (Reuters): South Africa's Del Monte Royal Foods Ltd said on Monday it is looking at possible acquisitions in Indonesia and Malaysia to complement its latest buy -- Thailand's Siam Agro Industry Pineapple Co Ltd (SAICO).

"We are looking at Indonesia and Malaysia. I can't be specific, but it would be in line with our core business activities," Vivian Imerman told Reuters in an interview.

Delfood said it acquired a majority stake in SAICO, a major Thai pineapple canner, for 133.2 million baht ($3.75 million).

"Our stated strategic objective is to get a leadership position in our core competent areas, one of which is pineapple," Imerman said. "And, as a result, we've been looking for opportunities in Asia to fulfill our undertakings in terms of our strategic focus."

He said Del Monte, a producer of branded fruit products, had wanted to invest in Thailand for years, but it had only become possible because of the country's economic crisis.

"It was a good time to get in. In years gone past it was too expensive for us; the entry point was too expensive," he said. "We expect to make a healthy return, that's why we are investing here and that's why we are committing our people here. We expect to make it as viable as any of the other operations, which are extremely successful."

For instance, he said, when the firm took control of its operations in the Philippines about five years ago, it was making around $5 million a year.

"Now we have taken that up to between $40 and $50 million a year."

Delfood also owns a joint venture, Del Monte Pacific Resources Ltd, in the Philippines.

"We hope to repeat that here. I don't know about similar figures as we are starting off with a totally different base, but we certainly intend to grow the profitability exponentially."

Imerman said Del Monte aimed to expand its share of global pineapple production to around 50 percent. It says it currently controls more than 35 percent of world pineapple supply.

The company hoped to issue a statement in the next two weeks about its plans to list in Asia.

He declined to say where the listing would be, but that there were a number of countries shortlisted. Asked if it would be a single listing in one country in Asia, he said: "Most probably, yes."

He said the firm wanted to take advantage of expansion opportunities, adding: "We have numerous opportunities which are impossible to internally finance."

Imerman said in March the firm planned an Asian listing within a year.

Delfoods is currently listed in Johannesburg and has been looking at the possibility of moving that listing offshore. Europe was "one possible area", he said.

"We are still pursuing the exercise. We haven't yet decided under which jurisdiction to list the company."

Imerman said in March the firm might not be listed in South Africa much longer as most of its business was offshore. He said then New York was one center the company was considering.