Rainbow Chicken listed today on the JSE Main board

Published Jun 26, 2024


ONE of South Africa’s best-known chicken producers, Rainbow Chicken, has listed on the JSE Main Board as a primary listing.

Rainbow Chicken, founded in 1960 as a small family-owned business, is one of South Africa’s largest poultry providers, and prior to listing was 100% owned by food products manufacturer RCL Foods.

Today, Rainbow is an integrated broiler producer and functions at all stages of chicken production, from farm to fork. The group’s fully integrated business model incorporates all stages of chicken production.

It controls and operates 165 farms, 1 288 houses, eight hatcheries, three primary processing plants, two further processing plants dedicated to added-value chicken products, six animal feed mills, and it holds a 50% shareholding in a joint venture (Matzonox) which operates two waste-to-value plants.

Its primary retail brands include Rainbow, Rainbow Simply Chicken, and Farmer Brown, while food service brands are FlavourBurst and Rainbow Ready2Go, all of which cater to a wide array of consumer needs and preferences.

As South Africa’s second-largest feed company, Rainbow Chicken delivers feed through its Epol and Driehoek Feeds brands.

The listing is part of the process of Rainbow being unbundled by its parent company, consumer goods giant RCL Foods, a decision which was first announced in March this year.

The unbundling offers local investors a new investment opportunity.

Rainbow CEO Marthinus Stander said: “Stepping out as a standalone entity marks a significant milestone for Rainbow, carving out a unique and competitive position in the market. We aim to re-establish and rebuild our chicken and feed businesses as best-in-class in terms of customer-centricity, delivering value via innovation and leveraging our heritage.”

The unbundling will be implemented through a distribution of 890 296 405 ordinary shares, in the ratio of one Rainbow Chicken share for every one RCL Foods share held – with shares set to start trading from 1 July, 2024.

“We are thrilled to welcome Rainbow Chicken to the JSE as an organisation seeking new growth avenues for the business, and pleased that the company selected the JSE as a preferred venue to unlock value,” said JSE Capital Markets director Valdene Reddy.

“We’ve already seen several listings in recent years where an entity has chosen to unbundle, usually to find new direct access to equity markets and supporting firms as they expand.

“Similarly, we know that Rainbow Chicken’s decision to list as its own entity is a testament to the JSE’s ability to provide issuers with access to liquidity and capital on our exchange,” said Reddy.