Blow for local economy as Enterprise Polokwane Plant set to close soon

POLOKWANE – The news that the Enterprise Polokwane Plant will be closing within the near future, was met with shock by businessmen and consumers as well as retailers who were supporting this longstanding business since before the outbreak of listeriosis in December 2017.

Brendon de Boer, the CEO of Enterprise Food’s parent company, Country Bird Holdings (CBH), confirmed on Tuesday that at the plant, production will stop within the first 10 days of April, but that canning operations will continue.

“The retail outlet will keep on trading for now and there is no trading closure date at this stage,” De Boer assured.

De Boer explained that since the acquisition of the Enterprise business in 2020, there has been a number of unforeseen changes in the market circumstances that have heavily impacted on the intended turnaround strategy for the business.

“These have included material increases in the cost of certain raw materials and key inputs to the business together with the inability to recover these increasing operating costs within the current environment. Exacerbating this environment is the detrimental impact that Covid-19 has had on businesses and the economy. As a result, month-to-month financial losses have increasingly posed a threat to the continued sustainability of the company as a whole,” De Boer stated and added that in the light of the above, CBH is planning the closure of the Enterprise Polokwane Plant, pending engagement with the labour force.

“The decision has been an extremely difficult one to make but has become an unavoidable necessity. Enterprise canning operations at the Polokwane plant will continue as before, with the retention of 50 staff members,” De Boer concluded.

The challenges facing Enterprise Foods started in December 2017 when the then Minister of Health, Aaron Motsoaledi, announced that the source of a listeriosis outbreak was two brands of polony manufactured by Enterprise Foods, owned by Tiger Brands and another manufacturer. Health officials traced the source to the Enterprise food production facility in Polokwane and the National Consumer Commission ordered a recall of all Enterprise polony, smoked russians and frankfurters.

In September 2018, two and a half months after the listeriosis outbreak was declared over, Enterprise Food products made a comeback to the market, although not from its factory in Polokwane, despite speculation during the crisis that the brand might never recover from the fallout. It was speculated that, as a result of the outbreak, more than 5 800 tonnes of affected food had been recalled and destroyed.

In October 2020 Tiger Brands announced that it had completed negotiations for the sale of its meat business, in a deal worth more than R300m to Country Bird Holdings, the owner of the Supreme Chicken brand.

The sale included the processing plants in Germiston, Pretoria and the Polokwane factory where Enterprise polony is made.

Country Bird agreed to pay R153m for the processing plants, plus what had been estimated at a little under R160m for inventory.