South African Firm Backs Out of Israeli-led Dairy Purchase After BDS Pressure

Brimstone had partnered with Israel’s Central Bottling to buy dairy firm Clover

File photo: Dairy cows are seen at the French non-pasteurized Camembert cheese farm ''Le 5 Freres de Bermonville", in Bermonville, France, March 12, 2019.
REUTERS/Gonzalo Fuentes

South Africa’s Brimstone Investment Corporation said it was pulling out of a proposed 4.8 billion rand ($345 million) buyout of dairy firm Clover Industries, amid opposition from an anti-Israel group.

It has a 15 percent stake in Milco SA, the consortium offering to buy Clover, which is headed by Israeli beverage firm Central Bottling Company (CBC).

Brimstone said on Friday it was in advanced negotiations with an investor to take over its role, and another partner in the consortium would acquire its stake if it had not found a suitable replacement by the end of this year.

>> 'Artwashing:' BDS activists ramp up pressure on Eurovision 2019 in Israel

The South African investment firm pulled out after criticism of its involvement from pressure group Boycott, Divestment, Sanctions against Israel in South Africa (BDS SA).

Shares in Clover, which processes products including yogurt and olive oil, initially slipped around 2 percent but had recovered by 12:53 GMT to stand at 23.23 rand, down 0.51 percent on Thursday’s close. Brimstone shares, which often go days without trading, had not yet traded.

A representative for Clover said the firm had no comment on the news while, in Jerusalem, CBC was not immediately available for comment.

Brimstone said in a stock exchange filing that it was in talks regarding the Milco stake with a “potential replacement B-BBEE shareholder” - meaning a broad-based black economic empowerment investor that, like Brimstone itself, would be majority black-controlled and managed.

If it has not found a suitable replacement by December, it has secured a backstop agreement with one of the other partners, International Beer Breweries Limited, to then acquire Brimstone’s entire stake.

South Africa’s Brimstone Investment Corporation said it was pulling out of a proposed 4.8 billion rand ($345 million) buyout of dairy firm Clover Industries, amid opposition from an anti-Israel group.

It has a 15 percent stake in Milco SA, the consortium offering to buy Clover, which is headed by Israeli beverage firm Central Bottling Company (CBC).

Brimstone said on Friday it was in advanced negotiations with an investor to take over its role, and another partner in the consortium would acquire its stake if it had not found a suitable replacement by the end of this year.

The South African investment firm pulled out after criticism of its involvement from pressure group Boycott, Divestment, Sanctions against Israel in South Africa (BDS SA).

Shares in Clover, which processes products including yoghurt and olive oil, initially slipped around 2 percent but had recovered by 1253 GMT to stand at 23.23 rand, down 0.51 percent on Thursday’s close. Brimstone shares, which often go days without trading, had not yet traded.

A representative for Clover said the firm had no comment on the news while, in Jerusalem, CBC was not immediately available for comment.

Brimstone said in a stock exchange filing that it was in talks regarding the Milco stake with a “potential replacement B-BBEE shareholder” - meaning a broad-based black economic empowerment investor that, like Brimstone itself, would be majority black-controlled and managed.

If it has not found a suitable replacement by December, it has secured a backstop agreement with one of the other partners, International Beer Breweries Limited, to then acquire Brimstone’s entire stake.