October 25, 2018

South Africa’s Public Investment Corporation (PIC), the manager of pension funds for South Africa’s government employees, and Pelo Agricultural Ventures have acquired a majority stake in Karan Beef Pty Ltd., the largest cattle company in Africa, for US$360 million.

Founded in 1974 by the Karan family, the company began with less than 100 head of cattle. Today, it operates the continent’s largest cattle feedlot and abattoir, and owns three adjoining farms, an abattoir with a capacity of 2,100 head per day, and a distribution center.

South Africa was ranked as the top consuming country of beef in sub-Saharan Africa last year, and as the 14th top consuming country worldwide, according to the Organization for Economic Cooperation and Development (OECD). With a population of 55 million, South Africans consumed 869,400 tons of beef last year. Karan Beef mainly sells to its own high-demand, domestic market, however, the company also is responsible for significant exports to UAE, Kuwait, Qatar, Bahrain, Oman, Jordan, Egypt, Mauritius, Seychelles, Maldives, China, and Hong Kong.

Cyril Ramaphosa, president of South Africa, has earmarked agriculture as an industry of focus and a priority for growth as the administration works to pull the country out of a recession. The administration is also pushing for redistribution of the country’s economy to black South African ownership after the country’s period of apartheid.

Pelo Agricultural Ventures is a domestic, black-owned and managed agricultural investment firm headed by CEO Aobakwe Kukama, who stated that the firm with work with Karan Beef’s existing team to achieve growth.

“This is a historic deal … which will support the much needed transformation in the agricultural sector,” said Daniel Matjila, CEO, PIC.

“We are, particularly, happy that the Karan family has decided to sell part of this important asset to South Africans, ensuring that ownership remains local and in black control.”

Ivor Karan, owner of Karan Beef, is also optimistic about what this deal will mean for both the future of the company and South Africa’s agriculture sector.

“This is a ground-breaking deal for agriculture in SA and we must celebrate the fact that the company will remain South African,” said Karan. “We look forward to taking our new partners under our wings and sharing 45 years of knowledge and expertise with them.”

-Lynda Kiernan