Banele Ginindza
The Daybreak Business Rescue Practitioners (BRPs) have shortlisted four potential strategic equity partners (SEPs) for the Public Investment Corporation (PIC)-owned poultry producer, signalling growing confidence in the company’s turnaround efforts.
Daybreak’s Transaction advisor, Park Village Auctions (PVA), on Monday said the selected bidders are actively engaged in due diligence, including virtual data room review, physical site inspections, and in-depth sessions with management and the business rescue team.
In an update, Daybreak said on the operational front, the company has made progress in stabilising hatchery and breeder operations with three sites having been repopulated in August and September, with production volumes on track to reach 1.5 million day-old chicks by March 2026.
Tebogo Maoto, senior BRP, said while the recent R150 million PIC injection supports the rescue plan, the BRP is seeking further funding for the critical Reactivation Phase.
Maoto said that capital injection and proven turnaround expertise are the primary criteria for selecting a winning partner, alongside extensive poultry sector experience and transformation credentials.
Preference is being shown for parties aiming to acquire or partner with the business as a whole, rather than with piecemeal divisions.
Maoto said regulatory compliance remains central: potential investors must satisfy Competition Commission and Public Finance Management Act (PFMA) requirements aligned with the Public Investment Corporation (PIC), Daybreak’s major shareholder.
He said the successful SEP will take an active role in operational oversight and governance. As such, a strong commitment to employee retention is a key evaluation factor in this process.
“Though staff contracts remain protected under the Companies Act, the BRP acknowledged that retrenchments are “unavoidable” as Daybreak enters the Reactivation Phase, with formal proceedings delayed pending a decision from the Temporary Employer/Employee Relief Scheme (TERS),” Maoto said.
He said active engagement continues with government, unions, and employee representatives to minimise job losses and manage the process transparently.
In terms of asset recovery, PVA reports that the sale of the non-core Howick property and hatchery met its objectives, with disposal proceeds earmarked for working capital and operational needs, pending creditor approval.
Maoto said additional disposals may be implemented in future phases.
“Relations with creditors and suppliers remain stable in the wake of near-unanimous plan approval, but Daybreak’s positioning strategy for regaining market and supply chain confidence will only be rolled out once the Reactivation Phase is underway,” Maoto said.
“Daybreak’s recovery and SEP process remain closely watched as a test of turnaround strategy in South African agribusiness, with stakeholders hoping for a sustainable outcome for the company, its workforce, and the broader food supply chain.”
Appearing before Parliament’s Portfolio Committee on Finance on Friday, PIC CEO Deon Botha said Daybreak’s cash flow management had improved significantly, with the company still holding R73m from the R150m endowment dedicated to its turnaround strategy.
Botha said that compliance issues flagged by the National Society for the Prevention of Cruelty to Animals (NSPCA) have been addressed, with all birds now vaccinated.
“As we speak, we are now at reactivation plan as BRP plan approved by the creditors. We are putting online the Sundra Abattoir, we are trying to put on an extra R300m to ensure that the reactivation happens and in parallel with the reactivation, we are also looking at the strategic partner,” Botha said.
“The BRP has gone to market and is now actually reviewing the submissions and we are looking forward to that decision finalised in late January or early February somewhere there.”
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