Business

End of an era for 202-year-old giant in South Africa

Luke Fraser

 ·17 Jun 2026

Premier Group has acquired RFG Holdings Limited in a deal worth R6.5 billion, with the deal adding a host of new brands and ending a period of stock illiquidity for the group.

Premier, which was founded in 1824, completed the acquisition of RFG in March 2026. The value of the deal was R6.5 billion.

The Premier share price increased 12% from the reference price of R154.00 per share at announcement to R172.78 at implementation.

The consideration was primarily settled by the issuance of new Premier shares on a 7:1 basis. Anchor Capital said that the deal made financial sense, given the previous limited liquidity in Premier shares.

The acquisition also added a broad, complementary collection of leading brands to Premier’s stable, bringing 53 iconic brands into its portfolio.

Premier’s existing brands include Snowflake, Blue Ribbon, Impala and Iwisa. RFG added Rhodes Quality, Bull Brand, Pakco, Magpie, Hinds Spices, and many more.

In its financial results for the year ended 31 March 2026, the group also completed the commissioning of the Aeroton bakery during the second half of the year.

This new bakery is expected to meaningfully contribute to economies of scale and introduce further efficiencies into the bread manufacturing and distribution process.

With volumes steadily ramping up since March 2026, old bakeries will be decommissioned, and bread availability will be improved in key inland markets.

The group’s revenue increased by 6.6% to R21.2 billion, primarily driven by 5.1% revenue growth in the Millbake division, comprising 81% of revenue

Revenue in the Groceries and International division also increased by 13.5%, boosted by the
contribution of RFG’s financial results from 11 March 2026.

The group’s operating profit rose by 23.2% to R2.4 billion, and the operating profit margin improved by 150 basis points to 11.1%.

Its earnings per share also rose by 27.4% to 1,192 cents and headline earnings per share by 27.7% to 1,204 cents.

The inclusion of RFG’s results from the effective date had no effect on EPS, and the net effect was an increase of 3 cents in HEPS.

The group also declared a final gross dividend of 182 cents per share, bringing the total dividend to 341 cents per share.

Outlook

Looking ahead, the group said that the primary focus of FY2026 will be completing the “RFG integration and unlocking the merger synergies.”

At the EBITDA level, the Groceries division, which now houses the Culinary business, is expected to account for around one-third of the business, with Millbake accounting for the remaining two-thirds.

The group added that the post-acquisition integration is well underway and that it remains confident of delivering the expected cost savings and synergies.

“Consolidation of key suppliers, cost reductions from increased scale and integration of operational and support functions are expected to be materially completed by the end of FY2027,” it said.

However, the group warned that the increase in fuel, packaging and other fuel-related input costs is likely to necessitate price increases across the portfolio of around 5%.

While the deflationary global soft commodity price cycle appears to have bottomed out, it warned that the forecasted Super El Niño is expected to negatively impact grain supply and prices.

The ongoing tariff uncertainty is expected to hurt international sales for its Culinary division.

However, it said the current 10% to 12.5% US Tariff rate is better than the previous 30% rate and creates a more favourable trading environment.