Pioneer Foods has contributed to South Africa’s rich agricultural heritage. Our core business is the production, distribution, marketing and selling of a diverse range of food, beverages and related products for both human and animal consumption.
The present day company was formed in 1997, and is built on the foundation laid by two pioneering farming co-operatives, namely Bokomo and Sasko, and this journey began nearly 100 years ago. Follow the menu links in sequence to read the story of our journey from 1912 to 2008 - each represents a different era in our history.
The timeline view highlights the key milestones that paved the way to Pioneer Foods becoming a significant player in the food and beverage business sectors in Southern Africa.
Pioneer Foods roots can be traced back as early as 1912 when, as a result of the agricultural and financial hardships caused by Second Anglo-Boer war (1899–1902), Swartland grain farmers formed a co-operative in Malmesbury called Wesgraan. Wesgraan was short for Westelike Graanboeren Ko-operatieve Vereniging.
The co-op helped farmers to collectively boost wheat sales and pool resources, which enabled them to acquire equipment and other requirements more cost-effectively. Producers quickly realised the benefit of belonging to Wesgraan, and membership grew rapidly.
A few years later, in 1920, Wesgraan established a milling company to mill the wheat of its producers into flour and other marketable products, as well as to protect its members against price speculation. The milling company was called Bokomo, which was short for De Boeren Ko-operatieve Molen Maatschappij Beperkt. Bokomo was the first flour milling company of its kind in South Africa.
By 1929, the Great Depression and record droughts in the Cape had caused a decline in agricultural prices. Wesgraan and Bokomo realised they needed the support of other wheat co-operatives to remain viable. Therefore, on 7 October 1930, Sasko was formed to sell wheat centrally for co-operatives across South Africa, with the goal to stabilise the wheat prices and industry. Sasko was short for Suid-Afrikaanse Sentrale Ko-operatiewe Graanmaatskappy Beperk.
However by 1934, Sasko had experienced a sizeable drop in the percentage of wheat it was handling, and stabilising wheat prices was still problematic. So, in order to retain control over its produce and remain sustainable, Sasko expanded and entered the wheat milling industry.
The Wheat Board
By 1935, government had established The Wheat Board to stabilise and regulate the wheat, milling and baking industries. By 1949, The Wheat Board provided farmers with financial support, standards, quality control and infrastructure. The Wheat Board also instituted weight regulations on bread loaves and controlled the price of wheat and flour. The Wheat Board therefore took over Sasko’s founding intention to stabilise the wheat industry and prices, leaving Sasko to concentrate on wheat milling.
Over the next few years, Bokomo and Sasko would form ties that would set the scene for their eventual merging.
Over the next few years, Bokomo and Sasko formed ties that would set the scene for their eventual merging and future direction.
First agreement between Sasko and Bokomo
The first co-operation agreement was in 1942, whereby Sasko shareholders acquired 27% shares in Bokomo, and as a result, the Sasko-Bokomo Co-operative was formed.
Products were successfully marketed under the Sasko/Bokomo brand, and expansions were jointly undertaken. The co-operative gained competitive advantage by saving on rail and delivery costs, and by centralising milling and administration. During this time, Sasko/Bokomo also acquired the established milling business and Sunshine Bakery of Messrs Daniel Mills & Sons Ltd in Cape Town.
In November 1947, the Sasko/Bokomo Central Co-operative Limited was formed to drive sales and appoint managing members by area. However, this process failed, causing relations between Sasko and Bokomo to deteriorate.
Sasko and Bokomo go their separate ways
By 1948, Sasko cancelled the first co-operation agreement with Bokomo, and the companies reverted back to independent operations. Sasko concentrated on milling and baking, while Bokomo focussed on breakfast cereals, broilers, eggs, and animal feeds.
By 1961, the Minister of Agriculture established a committee to look at closer co-operation between Sasko and Bokomo. The organisations agreed that better co-operation was possible, but negotiations proved unsuccessful, and the matter was shelved until the next decade.
Second Co-operative agreement between Sasko and Bokomo
By the 1970s, more attempts were made at establishing ties between the two companies. As a result, on 29 October 1973, the Sasko-Bokomo Central Co-operative was registered, as a co-operative agricultural company with limited liability, to serve as a liaison between the members of Sasko and Bokomo.
This agreement lasted for 13 years, and was the first real step towards a merger between Sasko and Bokomo.
In the years leading up to the merger, Sasko and Bokomo complemented rather than competed with each other. Sasko was a leader in the milling and baking fields, while Bokomo focussed on breakfast foods, broilers, eggs, and animal feeds. Sasko’s mills and bakeries were spread throughout South Africa, while Bokomo’s operations were mainly Cape based.
The Sasko-Bokomo Central Co-operative deregistered
By 1987, the Sasko-Bokomo Central Co-operative, which had lasted 13 years, was deregistered. However, this period of collaboration between Sasko and Bokomo played an important role in paving the way towards a merger 10 years later.
By 1995, government’s regulation over the milling and baking industries ended, and the control boards, such as The Wheat Board, were dissolved. This marked the end of state control and co-operative ownership in the South African agricultural industries. Deregulation offered both Sasko and Bokomo the opportunity to become privately run profit driven businesses.
Sasko and Bokomo become private companies
By 1996, Bokomo and Sasko had converted from co-operatives to private companies within months of each other. The cross holding of company shares would play a positive role in ensuring shareholder support for the imminent merger.
Amalgamation on the horizon
After becoming private companies, Sasko and Bokomo started strategically evaluating the long-term advantages of combining forces. Amalgamation proved to be the best option. It would provide maximum benefits for both companies with a national footprint of mills and bakeries.
Deregulation of the milling and baking industries had resulted in over capacity and created pressure on the profitability of both companies. To optimally utilise capacity and management skill in the deregulated environment, a merger seemed inevitable.
A merger between Sasko and Bokomo seemed like a natural progression, in view of the companies’ similar and shared history, and complementary business models.
In May 1997, the merger between Sasko and Bokomo to form a new company, Pioneer Foods, was announced. This event marked the joining together of two of the country's long-established leaders in the food sector, after courting each other for over 50 years.
The benefits and prospects of the merger were compelling:
The amalgamation of Sasko and Bokomo created a significant player in the South African food sector. Over the next 10 years, from 1997 to 2007, the newly formed organisation, operating as Pioneer Foods, would prepare the way to listing on the Johannesburg Stock Exchange.
Making a smooth transition
Initially, Pioneer Foods focussed on the integration and efficiency of the newly merged businesses of Sasko and Bokomo, by aligning operations and streamlining management structures where possible, mainly in the milling and baking divisions.
The company also adopted a decentralised management philosophy model, in order to maintain the right operational focus and ownership at divisional levels.
The merger provided a joint revenue of R3,5 billion per annum, earnings of R130 million, total assets of R1,54 billion, and total fixed assets of R576 million.
Pioneer Foods enters a growth phase
The post-merger era was a period of high growth and diversification for Pioneer Foods. The company embarked on a series of acquisitions and joint ventures, as well as in-house product innovation.
Pioneer Foods launched into expansion mode:
Preparing to list on the JSE
In the 10 years after the successful merging of Sasko and Bokomo, the Group practically trebled in size.
By 2007, Pioneer Foods was ready for the next step to potentially unlock more value to its shareholders. At the time-shares in the company were traded to the market informally - “over-the-counter”. The next logical step was to enhance tradability and investor interest by listing the group on the Johannesburg Stock Exchange.
The merger of Bokomo and Sasko to form Pioneer Foods would enable the listing of a sizable food group on the Johannesburg Stock Exchange (JSE).
Preparing to list on the JSE
The growth and performance of the Group over the years after the merger had ensured a spread of household brands across virtually every food and beverage product segment, and being listed on the stock exchange had many advantages for the Group, as part of the company’s expansion strategy.
Moreover, the stock exchange listing would add to the company's corporate standing and provide access to a wider shareholder base, which would facilitate the raising of equity capital to support investment and expansion plans.
Following the merger in 1997, some key milestones were achieved to enhance the company profile prior to listing:
On 22 April 2008, Pioneer Foods, one of the most significant players in Southern Africa’s food and beverage industries, listed on the Johannesburg Stock Exchange. It was a momentous occasion for the Group and its shareholders.
The struggling pioneers and farmers that formed Bokomo and Sasko back in the first half of the 20th Century could never have guessed how far along the road their co-operative organisations would go. Almost 90 years later, the stock exchange listing proved that the Pioneer Foods Group was well on the way towards its vision, to be a leading food and beverage company through globally trusted brands.
SA wheat export begins.
Second South African War takes its toll on local agriculture.
Westelike Graanboeren Ko-operatieve Vereniging (Wesgraan) forms to restore control of products to farmers, and to supply farming equipment to members.
14 August 1912
Pieter Adriaan Bergh becomes Wesgraan chairman and later of Bokomo and Sasko respectively.
26 March 1918
Resolution at extraordinary Wesgraan board meeting permits erection of co-operative mill and shares issued to farmers of 4 000 shares at £50 each.
De Boeren Ko-operatieve Molen Maatschappij Beperkt (Bokomo) forms to mill producers’ wheat and to provide a wheat market for members; post-WW1 famine crisis push domestic wheat production down.
Bokomo Mill, in Malmesbury in the Swartland area of the Western Cape, becomes operational.
Suid-Afrikaanse Sentrale Ko-operatieve Graanmaatskappy Beperk (Sasko) is established and acts to stabilise prices as the central body for the storage, treatment, processing and orderly marketing of wheat; local government fixes wheat price at 22s.6d. per bag; domestic wheat production rises to 70%.
Sasko’s handling of SA wheat production drops from 43% to 28% year-on-year; seven southern co-ops support Sasko and agree that Sasko should enter milling industry.
Sasko enters milling industry; Wheat Board forms and ultimately stabilises wheat industry for farmers.
Wheat is controlled under the Wheat Control Scheme, the Winter Cereal Scheme under the Marketing Act of 1937.
Sasko/Bokomo forms; acquires Messrs Daniel Mills & Sons Limited’s milling and Sunshine Bakery business in Cape Town; Sasko shareholders acquire Bokomo shares, giving the Co-operative a 27% Bokomo shareholding.
Sasko/Bokomo acquires four mills in the Free State and one in the Eastern Cape.
Sasko/Bokomo Central Co-operative Limited forms to drive sales by area 1948: Sasko/Bokomo relationship disintegrates; Sasko cancels agreement with Bokomo and both companies revert to independent operations; Sasko focuses on milling and baking with new 100-ton mill opening in Rondebosch.
Bokomo enters breakfast food business; acquires Weet-Bix (Cape), Woodstock Quick-Cooker Oats (Pioneer Oats) and Bokomo Flour.
Sasko opens 60-ton mill and 16 000-ton silo in Mobeni, Durban, and former Natal.
Sasko installs 100-ton mill, BonAccord, in Pretoria, former Transvaal.
Bokomo commissions new animal feeds mill in Malmesbury, Swartland, Western Cape.
29 October 1973
Sasko/Bokomo Central Co-operative registers as a Co-operative Agricultural Company with limited liability to liaise between Sasko and Bokomo members.
Sasko increases national bakery branches from 7 to 28.
Chicken feed production takes Bokomo into poultry industry.
Sasko begins diversification through joint venture with major shareholders, Caledon Riviersonderend Co-op (CRK) and SA Breweries, to form SA Maltsters.
Sasko and its 35 members handle 96,3% of the country’s wheat crop; Sasko takes over pasta factory Pastabarone in Johannesburg; acquires 30% shareholding in SA Maltsters.
Sasko celebrates 50th anniversary with record-breaking results in various operations.
Bokomo establishes Lemoenkloof Broiler Chickens in the Cape.
White bread subsidies abolished.
Bokomo opens additional Weet-Bix factory in Atlantis, Cape Town, Western Cape.
Sasko/Bokomo Central Co-operative deregisters; Bokomo buys egg production unit in the former Transvaal; Sasko courts computerisation and initiates management information system.
Weet-Bix becomes top seller in the ready-to-eat breakfast range.
Bokomo takes over Premier Food’s interest in Nulaid and merges operations with Lemoenkloof, buys Tydstroom in the Western Cape, and takes over Tongaat Hulett’s egg interests in KwaZulu-Natal to secure production in all provinces and market all its eggs under the Nulaid brand.
Brown bread subsidy and price control over bread and flour ends with deregulation of milling and baking industries; Bokomo opens modern slicing, packing and handling facility, enters joint venture with Uni-Quaker and erects plant to manufacture bread rolls for McDonalds.
Sasko continues diversification programme - gains interest in soy-based food production company Lebnor Foods; enters the maize milling industry by combining the activities of five major maize milling co-ops into a company called Amaizco, and obtains management control; enters co-operation agreement with Bakers, a division of National Brands, to access low-cost biscuit manufacturing market.
Sasko forms strategic international alliances to launch bromate-free, vitamin-enriched bread; obtains management control over Lebowa Bakeries, former Northern Transvaal, and full control of soy company, Lebnor Foods and Amalgamated Bakery and Catering Products.
Deregulation begins; control boards dissolve; SA agriculture returns to free-market situation; Bokomo renames feeds division Pioneer Feeds (Pioneer), then later Nova Feeds; Bokomo enters pasta industry.
Bokomo’s frozen foods range, Today, becomes market category leader; millers import wheat independently; Bokomo becomes a company; Sasko consolidates during a challenging year for the industry and changes from co-operative to company with shares at R240 each.
Sasko and Bokomo merge, known as Bokomo/Sasko and later as Pioneer Food Group Limited, with a focus on wheat and maize milling, production of bread, confectionery, breakfast cereals, pasta, eggs, broilers, frozen foods, animal feeds and packaging material; R3,5 billion per annum, earnings of R130 million, total assets of R1,54 billion and total fixed assets of R576 million.
Pioneer Foods acquires CPC Tongaat maize mills; the ProNutro, Maltabella, Kreemy Meal and Toddlers breakfast food brands; and a 37,5% shareholding and managerial interest in Ceres Fruit Juices (CFJ) incorporating the Liqui-Fruit, Ceres and Fruitree brands.
Pioneer Foods buys chicken breeding unit in Uganda and a 50% interest in Grain Health Foods, which produces breakfast cereals in England.
Pioneer Foods expands into jams, preserved fruit and vegetables, glazed fruit and cake mixes by acquiring Sugarbird.
Pioneer Foods gets 100% interest in SAD, which processes, packs and markets dried fruit products under the Safari brand.
Pioneer Foods acquires 100% shareholding in CFJ; establishes joint venture with US-based food global HJ Heinz Company to manufacture Heinz ketchup products in South Africa (Heinz tomato ketchup, Heinz baked beans, Heinz two-minute noodles, Wellington’s chutney and the distribution of John West canned fish products); establishes Bokomo Botswana.
Pioneer Foods acquires Frucon Beverages, Moir’s, Western Cape rice brand Spekko, Golden Lay and Kwality Biscuits; establishes joint venture, Bowman Ingredients SA, with leading English wheat millers JAS Bowman and Sons; pays dividend of R100 million (43% higher than previous year); group share price rises by 100% from R5,25 per share to R14 just after year end.
Pioneer Foods signs with American PepsiCo Company to manufacture and distribute Pepsi-Cola, Diet Pepsi, Mirinda and 7-Up in South Africa; acquires Marmite, Bovril and Maizena brands with ownership extending to South Africa, Botswana, Lesotho, Swaziland, Namibia and Mauritius; adds Redro and Peck’s Anchovette brands; and Belso’s United Kingdom Cereals, muesli and breakfast-foods specialists, to access UK and Scandinavian markets.
Pioneer Foods implements BEE transaction with more than 11 000 employees of whom the majority were previously disadvantaged individuals; shares pegged at R30 each.
Pioneer Foods acquires Crossbow Brands (Pty) Ltd, which manufactures dried vegetables, and the assets of Savoury Foods; begins manufacturing Marmite and Bovril; prepares to list on the Johannesburg Stock Exchange.
22 April 2008
Pioneer Foods lists on JSE.