Premier opens talks on 424 Tulbagh job cuts as Sactwu takes merger dispute to commission

Premier Group has begun retrenchment consultations with 424 workers at its fruit-processing plant in Tulbagh, six months after the Competition Tribunal approved its takeover of RFG Holdings with a three-year moratorium on merger-related job cuts attached.

The JSE-listed food producer says the closure of Fruit Processing Western Cape is unrelated to the merger and follows a long decline in global demand for canned fruit. Its board decided in July not to reopen the facility for the coming harvest season, subject to legal and regulatory processes, and a Section 189 consultation is now under way.

As IOL reported on 16 September, the retrenchments are proceeding despite employment protections imposed as a condition of the deal.

What the Tribunal required

Premier completed its acquisition of RFG on 30 March, after the Tribunal approved the transaction on 6 March. RFG has since been folded into the group as Premier Culinary.

One of the conditions attached to that approval was a moratorium on merger-related retrenchments lasting three years from implementation. The order states that any retrenchment during the moratorium period will be presumed to be merger-specific unless the merged entity can show otherwise. It also allows retrenchments for operational requirements unrelated to the merger, and Premier says that is the case here.

“The proposed closure of the FPWC facility is solely as a result from the significant structural economic challenges affecting the global fruit-canning industry and is thus independent of the RFG transaction,” the company said.

Premier says the global fruit-canning industry has been in long-term decline, with canneries closing worldwide as demand for canned fruit falls. The plant exports about 90% of its production, and the company says its export prospects have deteriorated to the point where the facility is no longer economically viable.

US tariffs were already weighing on the business before the takeover. In November 2025, RFG said higher tariffs had reduced its competitiveness in the United States and pushed some customers to shift orders to producers in countries with a tariff advantage.

The dispute now sits with the Commission

Cosatu disputes Premier’s account. Its affiliate, the South African Clothing and Textile Workers’ Union, fought for the employment condition during the merger review, and has now referred the proposed retrenchments to the Competition Commission.

The Commission is investigating whether the job cuts breach the merger conditions. Premier says it is cooperating fully and providing the information requested.

Cosatu has said the plant’s difficulties were already known when the merger was concluded, and that the consequences of a closure would reach well beyond the company’s payroll. The federation puts the exposure at 400 workers, 200 farmers, thousands of farmworkers and five rural communities.

Tulbagh is a town of about 9 000 people, roughly 120 kilometres north-west of Cape Town, built on wine farming and known for the restored Cape Dutch, Edwardian and Victorian buildings along Church Street. A canning plant of this size is not a single employer in a place that small. It is the buyer at the end of a supply chain that runs through the surrounding farms, and the wages that keep the town’s shops and services turning over.

What Premier has left open

Premier has not closed the door on a sale. It says it is in talks with Langeberg Foods about transferring a significant portion of its fruit-supply contracts, and it plans to process some fruit at its Groot Drakenstein facility. The Tulbagh plant has been made available for possible repurposing.

The timing will be noticed. Premier expects headline earnings per share for the six months ending September to rise between 22% and 32%, with revenue forecast to climb between 35% and 45% following the RFG acquisition. In a trading statement on Tuesday, the company attributed the uplift to volume growth across several categories, improved efficiencies and consistent operational execution.

That is the tension the Commission will have to work through. A merged entity can be performing well at group level and still have one plant that does not stand on its own. The Tribunal’s condition anticipated exactly that argument and placed the burden of proof on the company.

The Section 189 process gives the 424 employees and their union a statutory seat at the table over selection criteria, alternatives to dismissal and severance terms. The Competition Commission investigation runs on a separate track and will turn on the evidence Premier files to show the closure is independent of the transaction.

The Commission has not said when it will conclude. Until it does, the consultation continues and the plant stays shut for the coming season.

Source: IOL, Premier eyes 424 job cuts at Tulbagh plant despite RFG merger conditions