Consumer goods company Premier Group has released an abridged pre-listing statement relating to the admission to listing of the ordinary shares of Premier Group in the “Food Products” sector of the main board of the JSE with effect from the start of business on March 24.

In connection with the admission is an offer to be undertaken by Brait Mauritius, which constitutes an offer for sale by Brait of 65.03-million ordinary shares to raise about R3.5-billion in aggregate, subject to certain terms and conditions.

The offer of the sale shares held by Brait, a wholly-owned subsidiary of Brait PLC, to South African qualifying investors and qualifying international investors, is intended to raise minimum gross proceeds of R3.5-billion, which has been fully de-risked prior to launch.

Brait will receive gross proceeds of up to R3.6-billion from the offer, which, together with its share of the November 2022 pre-listing distribution of R950-million, totals up to R4.6-billion, before fees and expenses.

The gross proceeds of up to R4.6-billion holistically address Brait’s future liquidity requirement and Brait says it remains committed to distributing its assets to its shareholders.

The main purposes of the offer and admission are to enable Brait to realise a portion of its investment in the company through the disposal of the offer shares, reduce its gearing and substantially eliminate the need for Brait to sell any further ordinary shares into the market, and clear the path for an unbundling of the remaining ordinary shares held by Brait to Brait PLC shareholders at an appropriate time in due course.

Moreover, it is expected to provide the company with access to capital markets, which it may use to support and develop further growth of the group in accordance with its strategy and to finance acquisitions of, or investments in, businesses, technologies and other assets in the future.

It will also provide holders of ordinary shares with a liquid public market on which to trade their ordinary shares; and raise the company’s profile through the listing and trading of the company’s ordinary shares on an established exchange and increase investor awareness regarding the company’s vision, strategy and operations.

Moreover, it will enable Premier to use listed securities to potentially raise capital in the future under circumstances deemed appropriate by the directors to, among other things, strengthen the company’s balance sheet and assist the group to optimise the capital structure of the group, to the extent required.

The company will not receive any proceeds from the sale of the offer shares to be sold by Brait under the offer.

Brait is expected to retain 60.67-million ordinary shares amounting to 47.1% of the shares in issue in the company post implementation of the offer and admission and says it will continue to work closely with the group’s management to drive growth and create value in the group.

Premier is a consumer goods company in Southern Africa that has expanded its portfolio from a traditional milling and baking business to include a groceries business.

In full-year 2022, Premier generated revenue of R14.5-billion and adjusted earnings before interest, taxes, depreciation and amortisation (Ebitda) of R1.5-billion. The Millbake and Groceries and International businesses contributed 82% and 18%, respectively, to Premier Group’s revenue.

Despite high commodity prices and pandemic-led headwinds, Premier says it delivered strong financial results over the three-year period to full-year 2022. Revenue grew by a compound annual growth rate (CAGR) of over 15% alongside a strengthening of margins driven by volume and market share growth, a recovery in the Cape Town bakery and CIM business and active cost management and operational efficiencies undertaken by management.

Adjusted Ebitda grew by a 20% CAGR over the three-year period.