Yorkshire-based R&R Ice Cream, Europe's largest private label ice cream manufacturer, announced earlier today it has agreed to acquire Nestlé South Africa's ice cream business for an undisclosed amount.
The Nestlé business boasts a brand portfolio that includes Rolo, KitKat, Dairymaid, Country Fresh, Eskimo Pie, and King Cone.
It products, which are produced at its Clayville manufacturing site near Johannesburg, are sold across South Africa and sub-Saharan Africa.
R&R Ice Cream believes the South African deal will "further enhance" its "reputation as a global player in the ice cream sector."
In a statement, Nestlé South Africa said the sale of such an asset was "not a decision that is taken lightly."
"However, as does any business, we continuously seek opportunities to improve our operations, review our portfolio and protect the livelihoods of our employees wherever we can," said Ian Donald, chairman and managing director, Nestlé South Africa.
"Springboard to grow sales"
The deal, which is subject to the approval of the South African Competition Commission, follows R&R's acquisition of Australian ice cream maker, Peters.
It purchased Peters, a former Nestlé business, from Sydney-based private equity firm Pacific Equity Partners (PEP) in May 2014.
Prior to its acquisition of Peters, R&R Ice Cream's interests were limited to Europe, where it produces ice cream for the likes of Asda, Tesco, and Carrefour, and boasts a brand portfolio that includes Nestlé.
"This acquisition is a major milestone towards our goal of becoming a leading global player in ice cream," said Ibrahim Najafi, CEO, R&R Ice Cream. "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 in Australia, 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 Africa continent," Najafi added.
PAI Partners, a Paris-based private equity firm, acquired R&R Ice Cream from Oaktree Capital Management in June 2013.
It immediately outlined its ambitions for R&R Ice Cream - vowing to support the "expansion of the company's international footprint."
Less than two-years on, it has invested in Australia and is on the verge of expanding into South Africa.
"R&R continues to from strength to strength and we are very pelased with its development under our ownership over the last two years," said Colm O’Sullivan, partner, PAI Partners.
"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."