South African billionaire Christo Wiese’s Premier Group plans $66 million in capex over next two years

Premier Group, a prominent South African fast-moving consumer goods (FMCG) conglomerate partly owned by billionaire tycoon Christo Wiese, has unveiled ambitious plans to allocate R1.2 billion ($66 million) toward capital expenditure (Capex) over the next two fiscal years.

The group envisions an annual Capex average of R600 million ($33 million) for the financial periods 2024 and 2025. This strategic move is aimed at bolstering production capacity and fortifying overall operational resilience.

Premier Group’s capital allocation: Focused bakery expansion in Johannesburg

The allocation strategy underscores Premier Group’s commitment to propelling growth across its diverse portfolio while concurrently providing robust support for essential maintenance activities. A focal point of this capital infusion is the expansion of the bakery unit, with a significant portion earmarked for the reconstruction of the Aeroton bakery in Johannesburg.

The importance of its bakery unit is evident as Capex for the preceding six months until September amounted to R239 million ($13.12 million), with a noteworthy R177 million ($9.72 million) dedicated to maintenance, and the remaining R62 million ($3.4 million) channelled into expansionary projects.

Further dissection of expenditure reveals that the Millbake segment spearheaded the capital investment drive, securing R171 million ($9.4 million), followed by the Groceries and International segment with R63 million ($3.4 million), and the corporate division receiving R5 million ($275,038).

Premier group’s strategic listing and manufacturing focus underpin growth

Premier Group, formerly a subsidiary of Brait SE, a prominent investment holding company, achieved a successful listing of its shares on the Johannesburg Stock Exchange in March.

Demonstrating a strategic shift, the group has prioritized substantial investments in upgrading manufacturing sites and optimizing facilities, aiming to uphold best-in-class efficiencies. This strategic focus is geared towards fostering growth and unlocking opportunities for expansion.

Wiese, a key player in South Africa’s business landscape, holds a commanding 46.69 percent stake in Premier Group through Titan Premier Investments, his private investment holding company. His diverse investment portfolio has significantly contributed to his status as one of South Africa’s wealthiest individuals, boasting a fortune estimated at $1.1 billion.