Lichtenburg Nut Company Business Plan — The Company

Legal structure, ownership, governance and the current stage of development.

Section 4 of 37

The Company

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3.1 Legal structure and ownership

Lichtenburg Nut Company (Pty) Ltd will be incorporated as a private company under the Companies Act 71 of 2008, with its registered office and sole operating site in Lichtenburg, Ditsobotla Local Municipality, Ngaka Modiri Molema District, North West Province. The company will be a manufacturer for VAT purposes and will register with the Department of Health as a food handling facility under the Foodstuffs, Cosmetics and Disinfectants Act.

Table 7. Indicative shareholding at financial close

Shareholder class	Contribution	Holding at close	Rationale
Founding management and operating team	R8.0m cash plus full-time executive commitment	10.0%	Alignment; the operating team must be materially exposed to execution risk
Lead financial or family office investor	R44.0m	45.8%	Anchor equity, board control alongside management
Development finance or agro-industrial co-investor	R22.0m	22.9%	Patient capital matched to the return profile; developmental mandate fit
Broad-based grower and employee trust	R6.0m, vendor-financed from dividends	6.3%	Supply security and B-BBEE ownership credentials; aligns growers to quality outcomes
Committed follow-on (drawn month 26)	R22.0m	15.0% on issue	Own brand launch and working capital

Total ordinary equity	R96.0m	100.0%

Percentages are indicative and assume the follow-on tranche is issued at the same subscription price. A discounted follow-on would dilute the founding round. Definitive terms would be set in a subscription and shareholders’ agreement.

3.2 Mission, vision and strategic objectives

Mission

To manufacture peanut butter South Africans can trust, from groundnuts we contract, shell and test ourselves

Vision to 2038

To be the supplier of choice for any South African buyer who cannot afford a recall — and the largest independent groundnut processor outside the listed food groups

Table 8. Strategic objectives and measurable targets

Objective	Measure	Year 3 target	Year 5 target	Year 10 target
Scale	Finished product volume	2,340 t	3,000 t	3,900 t
Profitability	EBITDA margin	8.1%	11.8%	12.3%
Capital efficiency	Return on invested capital	1.6%	9.5%	19.2%
Quality	Batches within 10 ppb aflatoxin	99.5%	99.8%	99.9%
Supply security	Volume from contracted growers	70%	75%	80%
Market position	Share of national category volume	8.1%	10.1%	12.8%
Employment	Direct employees	62	77	97
Balance sheet	Net debt to EBITDA	5.23x	2.00x	-0.05x

3.3 Location and why Lichtenburg

Lichtenburg sits in the North West province, which produces approximately 39% of South Africa’s groundnut crop, second only to the Free State. The site selection trades proximity to the consumer market for proximity to the raw material, and the plan should be explicit that this is a real trade-off rather than a free advantage.

Table 9. Site selection: an honest accounting of the trade-off

Factor	Lichtenburg (selected)	Gauteng alternative	Net effect
Raw material proximity	Within 120 km of the majority of contracted growers	400 to 600 km from the groundnut belt	Favours Lichtenburg: lower inbound freight, direct grower relationships
Outbound freight to Gauteng	230 km; R2.40/kg blended national distribution	Adjacent to national DCs; roughly R1.55/kg	Costs Lichtenburg about R0.85/kg, or R3.0m a year at Year 5 volume
Industrial property cost	R75/m² per month for leased warehousing	R110 to R135/m² per month	Favours Lichtenburg: saves roughly R1.7m a year at 3,600 m²
Skilled labour availability	Limited; supervisory and technical roles must be recruited from Gauteng or Potchefstroom	Deep pool	Costs Lichtenburg: relocation allowances and a longer hiring runway
Electricity and water	Ditsobotla municipal supply has a documented reliability record requiring on-site standby generation and storage	More reliable	Costs Lichtenburg: R9.4m of utilities capital including standby generation and 250 kWp of solar
Incentive eligibility	Qualifies for APSS; located in a district with high structural unemployment, improving the economic benefit score	Qualifies, weaker geographic spread score	Favours Lichtenburg: improves the probability of the additional 10% grant tranche

On balance the Lichtenburg location is net favourable, but the outbound freight penalty and the municipal utility risk are real and are carried in the financial model and the risk register.

3.4 Regulatory, licensing and certification requirements

Table 10. Licensing and certification pathway

Requirement	Authority	Timing	Status assumption
Company registration and VAT/manufacturer registration	CIPC; SARS	Month 1	Routine
Certificate of Acceptability (food premises)	Ditsobotla Local Municipality Environmental Health	Month 10	Required before production
Compliance with Regulation R.1145 (fungus-produced toxins)	Department of Health	Ongoing	Core operating obligation; 10 ppb aflatoxin ceiling
Foodstuffs labelling compliance (R.146 as amended)	Department of Health	Month 9	Artwork approval before first production
FSSC 22000 food safety certification	Accredited certification body	Months 9 to 14	Retailer prerequisite; assumed achieved before first retail despatch
Local content and B-BBEE verification	Verification agency	Month 12	Required for APSS and retailer scorecards
Water use and effluent discharge authorisation	Department of Water and Sanitation; municipality	Month 6	Low effluent load; trade effluent permit assumed
Air emissions (roaster) listed activity screening	District municipality	Month 4	Screening assumed to confirm the roaster falls below listed-activity thresholds
Occupational health and safety compliance	Department of Employment and Labour	Ongoing	Standard manufacturing obligations