Leading South African food brands manufacturer RCL Foods has acquired a 33.5% stake in the local firm, Hudani Manji Holdings Ltd (HMHL), the largest processors and suppliers of chicken in East Africa.
The new parent company for both Yo Kuku and Enkoko chicken brands will go by the name of HMH–Rainbow.
According to a statement released on July 31, the joint venture will now position HMH-Rainbow as the largest processor and supplier of fresh and frozen chicken in both Uganda and the East and Central Africa region.
Following the signing of the deal, the HMHL and RCL Foods teams are now preparing an integration plan with particular focus on how to rapidly grow the business to better serve the East African Community and other neighbouring countries.
RCL which is listed on the Johannesburg Exchange (JSE) and has a market capitalization of about 16 billion Rand is expected to inject more funds into the Ugandan operation.
“The new partnership between HMHL and RCL Foods aims to be the premier producer and distributor of animal proteins in East and Central Africa,” said Alykhan Hudani, the Chairman of HMHL.
“We have chosen Uganda as the headquarters for HMH-Rainbow due to its strategic location and friendly investment climate.”
Hudani added that following their huge investment which has been informed by the pace of the ongoing regional integration, they envision a greater presence in East Africa.
“RCL Foods is excited to enter the East African region with an established, reputable partner in HMHL.”
“Uganda specifically is an important market in which to have representation and is key to RCL Foods’ Africa growth strategy,” said Rob Field, the chief financial officer and the director responsible for Africa development.
Current plans for growth of the joint venture include; expanding the capacity of the broiler farms to reach 540,000 birds per cycle within the next 18 months.
The joint venture also intends to expand the feed mill to better serve local out growers of maize and soya beans; the main ingredients of the chicken feed as well as roll out a network of Yo Kuku retail shops to take chicken to every potential customer in Uganda and the immediate region.
A flagship store will also be commissioned at the HMH-Rainbow head offices in Kampala in the last quarter of 2015. This will be followed by an aggressive rollout of retail outlets across Uganda in 2016 and 2017.
In November, 2014, President Yoweri Museveni commissioned the $ 10 million ultra-modern poultry farm which is believed to be the biggest in East Africa.
It is nestled on 64 acres in Bulemezi, Semuto, about 50 km outside of Kampala and is owned by Hudani Manji Holdings, an independent family business which is also the parent company of Yo-Kuku, a brand of fresh and frozen chicken processed to international standards.
On the broiler farm, birds are reared in environmentally controlled and automated houses and more birds can be reared per square metre with a higher live weight and lower mortality.
The farm’s processing facility is also the first highly mechanized abattoir in Uganda. The abattoir processes about 2,500 birds per hour and 220,000 birds per week. The current capacity is 260,000 birds per eight-week cycle.
The investors have set up cold storage facilities that include transport for both chilled and frozen distribution and ensure that the chicken that reaches the customer is fresh and of the best quality.