COSATU Western Cape concerned about the planned closure of Langeberg and Ashton Foods by Tiger Brands

The Congress of South African Trade Unions (COSATU) in the Western Cape is very concerned that Tiger Brands has not yet changed its intention to close the Langeberg and Ashton Foods factory on the 10th of August 2022. Unless something is done urgently, contrary to the spin doctoring by the Western Cape government and its leaders, communities of Ashton, Klein-Karoo, Robertson, Bonnievale, Breërivier, Wolseley and Ceres will suffer dire economic consequences, leading to the loss of thousands of direct and indirect jobs at the factory and surrounding farming communities.

This is a crisis that can easily be avoided by Tiger Brands. There are ways to save the factory and prevent the complete destruction of jobs and communities. This company is a massive multi-billion rand corporate. It can easily afford more time to solve challenges at the factory.

There are also investors who are keen to find a deal and more investors keep stepping forward. Government at multiple levels has been mobilised to help find solutions. Funding institutions are also exploring solutions. As unions, we have been working tirelessly to engage various interested parties to find a solution and will continue to play a constructive role in this regard.

However, the reality is that none of these interventions will be implemented soon and likely not before 10 August 2022. Deals take time: due diligences must be done; plans must be made; funds must be raised; negotiations must happen; deals must be explored and structured. Even when everything seems on track, there will be unforeseen obstacles. Therefore, sufficient time must be allocated to the process of saving Langeberg and Ashton Foods and the jobs it creates.

Tiger Brands needs to commit to halting the retrenchments immediately and withdraw the proposed closure of the plant. Then, it must use the next 12 months to work collectively with partners to exhaust all possible opportunities to save this business and the jobs. This must include a decent and responsible handover to the new investor – in a manner that promotes the sustainability of the business and the wellbeing of workers and farmers.

Changes of ownership can be challenging. If such processes are rushed, the sustainability of businesses can be undermined. Therefore, Tiger Brands must ensure an orderly transition which includes a soft landing for the new investor that significantly improves their ability to succeed. The risk to Tiger Brands may be financial. But the risk of failure for workers and farmers is far higher.

There must also be a worker equity component for any deal. We reiterate that such a deal cannot repeat the mistakes of other equity deals – which are non-transparent, alienate workers from decision making and leave workers so indebted that they are always paying back interest and loans and never achieve any economic value. Such an outcome will cause problems at a later stage and will not achieve transformation and inclusivity.

Issued by
Malvern De Bruyn
COSATU Western Cape Provincial Secretary
For questions, further information, or further comment, please contact Malvern De Bruyn on cell number 060 977 9027 or Motlatsi Tsubane on cell number   074 482 6180