Bidvest announced that they were going to spin off and separately list their Food Services business on the JSE. This of course is not completely new news, an announcement in October last year about a restructuring plan had been telegraphed to the market. No time frames are given, shareholders are made aware that various obstacles and hoops need to be cleared and jumped through (poor, apologies grammar police) in order for this to happen. When we wrote about this the first time last year, in a message titled: Bidvest restructure, we pointed out that the FoodService business was around 116 billion Rand of revenues and just short of 4 billion Rands worth of trading profits.
We approve and continue to hold the company on the basis that the sum of the parts is worth more than the whole business. We continue to hold the stock, the stock has been one of the few good performers so far this year (outside of the resources space), up just over 10.5 percent year to date. Most of the recent heavy lifting may well have been done, whilst at one stage the stock was trading at an all time high of nearly 380 Rand, it settled lower, only up 0,43 percent on the day after all was said and done. I suppose we wait for more clarity on the timing, as we said, hold the stock until we have further news.