An 8 million USD equity investment in RedSun Dried Fruits & Nuts will expand raisin and pecan processing in the southern hemisphere, expected to add over 200 new jobs to the 163 existing positions.
Established in 2009, RedSun is based in Keimoes (Northern Cape), the region in South Africa where approximately 90% of the country’s raisins are produced. The company is at an advantage at a key juncture in the international raisin and pecan industry, as the US production level is shrinking, but demand is growing worldwide.
Norfund’s investment expected to sustain 163 direct jobs, and create more than 200 new permanent jobs and support more than 6,000 indirect jobs by investing in a rural part of South Africa where manufacturing job opportunities are scarce.
South Africa is an ideal country for production of both crops, and now Norfund’s investment in RedSun will help the company expand its business. South African raisin production has seen strong growth the last 10 years, and the trend is expected to continue. Similarly, the European demand for pecans is currently not met due to local consumption by the world’s two largest producers of pecans, the US and Mexico. South African pecan production more than doubled from 2014 to 2021, with production estimated to triple by 2030.
Norfund’s investment will fund new pecan wet cracking and raisin processing facilities. With the introduction of the latest technology, RedSun will continue to be at the forefront of production. This will be one of the first wet cracking facilities in the southern hemisphere, leading to increased processing and new jobs. The investment will also enable RedSun to build the first raisin processing facility in the Olifantsriver region (Vredendal) of South Africa.
Wet cracking technology has been used for more than 10 years in the US and provides higher yields than the current dry cracking technology used in South Africa. South Africa is the third largest producer of pecans in the world; however, it does not have a major pecan wet cracking facility operating in the country, which is due to the pecan production historically being too little to be financially viable for wet cracking.
“This investment in RedSun fulfills our mandate by creating jobs and increasing value in the company”, says project manager André Kemp.
“It is also in line with our strategy to create jobs by processing agriculture locally. The new pecan wet cracking facility and raisin processing facilities are going to be instrumental for the company and the region. We are excited to partner with an experienced management team and to benefit from 1K1V’s access to Three-Dimensional Capital”, he says.
Norfund will take an active shareholder role at RedSun and obtain a board seat as part of the investment.