DQS

Avian flu at Sovereign affects CBH bid

Shortly after Sovereign released a Sens statement informing shareholders that it had detected avian flu at a single layer house on a farm that forms part of its Uitenhage operations, CBH CEO Marthinus Stander said the company had decided to abandon its second bitterly fought attempt to gain control of Sovereign Foods.



Shortly after Sovereign released a Sens statement informing shareholders that it had detected avian flu at a single layer house on a farm that forms part of its Uitenhage operations, Country Bird Holdings (CBH) CEO Marthinus Stander said the company had decided to abandon its second bitterly fought attempt to gain control of Sovereign Foods.

Sovereign said that approximately 5,000 birds have been culled, approximately 1% of Uitenhage’s production pipeline. It said that its management was taking the appropriate steps and following the prescribed protocols to prevent the avian flu from spreading to other farms.

However, Stander contended that it is very difficult to contain an outbreak of avian flu to one section and expressed concern about the possible effect of avian flu on Sovereign’s Uitenhage operations. He said that CBH sees the avian flu situation as a game changer and that the company decided to walk away from its attempt to get control of Sovereign Foods.

In August, Sovereign stunned the market when it announced that private equity firm Capital Works was offering a hefty 33% premium on the R9 offer made by CBH in September 2016. After building up a 34% stake, CBH was forced to abandon that offer following a transgression of the takeover regulations. The company was forced to wait 12 months before launching a new bid.

By Ann Crotty
Source :

 

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