The Abraaj Group, through its funds, has bought a majority stake in Liberty Star Consumer Holdings (Libstar), one of the largest unlisted food and personal care manufacturers in South Africa. Abraaj completed the buyout of Libstar from its existing shareholders including Metier, Old Mutual Private Equity, Development Partners International and Lereko.
Established by Metier, Andries van Rensburg and Robin Smith in 2005, Libstar and its subsidiary companies manufacture a broad range of quality private label and own-branded products for the rapidly growing South African food, fast-casual dining, household and personal care markets. Its range of products covers cheeses, sauces and condiments, packaging supplies, baking aids, herbs and spices, beef and chicken products, pasta, imported European deli products, confectionery snacks, and detergents and washing powders. Some of Libstar's prominent customers include McDonald's South Africa, Woolworths, Shoprite, Pick n Pay, Spar and Tiger brands.
Libstar operates nationally through 23 business units located in five of South Africa's nine provinces and employs about 4,200 people with nationwide manufacturing, supply and distribution capabilities. Since its inception, its industry-experienced management team has pursued a successful buy and build strategy, growing and diversifying its product offering. Its key business units include Cape Herb and Spice which is the primary provider of private label spices, Finlar, the sole and exclusive provider of beef and chicken products to players in the QSR sector, Lancewood Holdings, a prominent manufacturer of soft cheese in South Africa, Rialto, the exclusive supplier to leading retailers of imported food products from Asia and Europe, and Dickon Hall, the leading producer of condiments in South Africa.
The US$56 billion South African grocery retail market and US$14 billion food services market are estimated to grow at 7% and 9.5% per annum respectively to 2018. Furthermore, the company's private label manufacturing, supply and distribution business has strong organic growth potential given Africa's low market penetration rates for private label products as well as the rising popularity of fast-casual casual dining across the continent.
