ESWATINI DAIRY TAKES OVER SWAZI MILK

MBABANE – The Swaziland Competition Commission (SCC) has approved the acquisition of the entire issued shares of Swazi Milk (Pty) Ltd by Eswatini Dairy (Pty) Ltd.

SCC Chief Executive Officer (CEO) Thabisile Langa reported that the acquirer, Eswatini Dairy, is a newly-formed company incorporated in accordance with the laws of Eswatini, and is wholly-owned by the Old Mutual Swaziland Agricultural Fund. The fund is an investment vehicle and has three partners, being Old Mutual Life Assurance Company of South Africa (OMLACSA), the Public Service Pension Fund (PSPF), and the Swaziland National Provident Fund (SNPF).

Swazi Milk is a privately-owned company incorporated in accordance with the company laws of Eswatini and is involved in the business of dairy farming. The firm produces raw milk and delivers it to its only customer, Parmalat Swaziland (Pty) Ltd. Langa explained that the products of the firms were considered and it was concluded that the relevant market is the production of raw milk in Eswatini.

“As a result of the transaction, Eswatini Dairy will merely replace Swazi Milk in the relevant market. The market shares in the relevant market, market concentration, countervailing power and barriers to entry would not be affected, hence the transaction was unlikely to result in the substantial lessening or prevention of competition. The acquisition was approved without conditions,” Langa reported.

The E200 million fund was established in 2012, and has managed to acquire three farms with two of them being converted into dairy farms. The remaining land has been set aside to farm blueberries and baby vegetables. It was explained that construction of the dairy farm started in October 2015 and the farms were already fully operational with 40 full time employees, 1 000 dairy cows roaming within the farm, over 600 cows under milking and producing about 9 000 litres of milk a day.
The newly-constructed 12 million litre dam is sufficient to sustain the farm for three years in times of water shortages.

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