| Thu 1 Apr 2010, 15:48 | | PFG - Pioneer Food Group Limited - Competition commission referral issued for |
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PFG
PFG
PFG - Pioneer Food Group Limited - Competition commission referral issued for
the White Maize Milling Market
PIONEER FOOD GROUP LIMITED
Incorporated in the Republic of South Africa
(Registration number: 1996/017676/06)
JSE share code: PFG
ISIN: ZAE000118279
("Pioneer Foods" or "the Company")
COMPETITION COMMISSION REFERRAL ISSUED FOR THE WHITE MAIZE MILLING MARKET
We refer to the SENS announcement dated 16 March 2010, which referred to the
Competition Commission ("the Commission") referral issued for the wheat milling
market and hereby advise that this announcement refers mainly to the
Commission`s referral issued for the white maize milling market as set out
below.
Further to the above, Pioneer Foods yesterday received notification, as
anticipated, from the Commission that it has referred its investigation into the
white maize milling market ("maize milling matter"), to the Competition Tribunal
for adjudication. Pioneer Foods is named as a respondent in the case together
with other industry participants.
The Commission has recommended an administrative penalty of R1.6 billion or 10%
of the 2009 annual group revenue of Pioneer Foods, although the referral refers
to conduct up to the 2007 financial year, with respect to the Company`s alleged
transgressions of the Competition Act in the white maize milling market.
As mentioned before, the Company wants to resolve the milling matters and other
matters through cooperation with the Commission, and without recourse to
proceedings before the Competition Tribunal, if possible. The Company has
already met the Commission in this regard.
The administrative penalty sought by the Commission in the milling matters may
be adjusted lower depending on the outcome of continuing negotiations with the
Commission. The Company is committed to fully cooperate with the Commission in
all investigations where the Commission seeks its assistance.
The Company is however, of the opinion, that the 2009 annual group revenue used
by the Commission in determining the administrative penalty is not the
appropriate revenue basis, but that the affected revenue should be used given
the Competition Tribunal`s judgement in the bread matter as well as the fact
that the alleged activities did not take place after 2007. The table below is
provided on request of shareholders seeking clarification on the various
revenue/turnovers.
Affected Affected Total Total Group
revenue - revenue - affected revenue/turn
Wheat Maize milling over
revenue
Rm Rm Rm Rm
Year ended 30 891.0 930.6 1,821.6 9,664.4
September 2006
Year ended 30 1,122.9 1,236,2 2,359.1 11,676.6
September 2007
Year ended 30 1,610.8 1,584.6 3,195.4 14,884.4
September 2008
Year ended 30 1,601.5 1,888.5 3,490.0 16,283.9
September 2009
Shareholders are further referred to the cautionary announcement dated 16 March
2010 and are advised to continue to exercise caution when dealing in their
Pioneer Foods shares until a further announcement is made. Pioneer Foods will
revert to shareholders on further progress in respect of this and other matters
once more certainty exists.
Paarl
1 April 2010
Sponsor
PSG Capital (Pty) Limited
Date: 01/04/2010 15:48:05 Produced by the JSE SENS Department.
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