Tiger Brands is considering selling its processed meats business that was identified as the source of the South African Listeria outbreak in 2017 and 2018.

The company said as part of a strategic review it had been looking at the possibility of selling its Value Added Meat Products (VAMP) business, which includes Enterprise Foods, in 2017. However, the outbreak and closure of manufacturing facilities delayed the evaluation.

The listeriosis outbreak began at the start of 2017 and was declared over in September 2018 with 1,065 confirmed cases and 218 deaths. It was traced in March 2018 to a ready-to-eat processed meat product called polony made at a plant in Polokwane run by Enterprise Foods, which is owned by Tiger Brands.

When the business re-opened at the beginning of the 2019 financial year, a review was started.

Offers received
A Tiger Brands stock market statement said this found the business was “not an ideal fit within its portfolio” and that consideration should be given to exiting the category.

It confirmed there had been “several indicative offers” and a formal due diligence process has been started ahead of a final decision being made.

Company officials said the actions do not affect its commitment to the class action legal process which is underway.

In April this year, owners of Tiger Brands said they planned to fight the lawsuit relating to the company’s part in the outbreak. The first stage of the process deals with liability. Damages would be handled at a second stage if the court finds the firm liable.

The firm of Richard Spoor Attorneys are representing more than 1,000 people affected by the listeriosis outbreak. The Seattle firm of Marler Clark LLP is serving as a consultant for the case attorneys.

Earlier this year, Tiger Brands issued subpoenas to food testing laboratories for information on the identities of those who submitted samples for listeriosis testing and results of these tests during the outbreak period. This action is separate to, but has the potential to delay, the main litigation.

No hearing is planned for this year but it could happen by mid-to-late 2020.

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