Colors, Farmsecure agreement bears fruit
2010-08-26
THE recent agreement reached between Paarl-based Colors Group and Farmsecure will pave the way for the Group’s further growth and investment in the South African fruit sector, says Ian Carstens, MD of the Colors Group. While the formalisation of the agreement remains subject to the requisite regulatory approval, its implementation has already resulted in additional working capital for Colors, allowing it to immediately settle a R57 million loan recalled by André Lombard. The first R40 million will be paid this week and the rest by the end of October, with Farmsecure signing security. Colors recently lost eight senior employees to Lombard’s fruit exporting business. Carstens says, “Colors intends using its partnership with Farmsecure as a platform for introducing new thinking and new solutions which will allow us to improve operational efficiencies and reduce risks across the entire fruit export supply chain.” Farmsecure focuses on empowering farmers through the provision of precision farming skills, agricultural knowledge and technologies. The Colors Group has grown its business significantly since its formation in the late 1990s. Not only has it grown its product portfolio, producer base and international customer base, but it has also diversified beyond its core business to take advantage of new opportunities. Carstens says recent changes in the industry have however emphasised the need for Colors to refocus its business. “We have come to the realisation – as many fast-growing companies do – that we need to concentrate on our core strength, which is fruit export. “We are extremely positive about the 2010/2011 fruit season having secured commitments, in principle, from both our growers and our international customer base.” Commenting on the recent organisational changes in Colors, Carstens says: “These changes have already provided opportunities through staff promotions and further opportunities will follow. I have also been heartened by the support Colors has received in recent weeks from all sectors of the industry. “It has shown that Colors has become so much more than a collective group of individuals; rather, it has evolved into a strong, highly-respected brand, both here and internationally.” The Colors Group is, by sales, the largest privately-owned agri-business in the South African fruit sector and South Africa’s second largest exporter of fruit. Lombard was their biggest customer and has threatened the company with a liquidation application, which he has withdrawn pending the repayment of the loan.
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