Daybreak Foods enters business rescue after years of mismanagement and financial decline

JOHANNESBURG - Daybreak Foods, one of South Africa’s largest poultry producers, has officially entered business rescue, following years of poor governance, operational failures, and deepening financial distress.

The company started the process on the 12th of June 2025, under section 129 of the Companies Act.

Senior business rescue practitioner Tebogo Maoto has been appointed to lead the process.

According to the rescue plan, the company is in "financial distress" as defined in law,  having been unable to meet its debt obligations or sustain operations due to widespread management and governance breakdowns.

Maoto says: “There will be retrenchments. If you read the plan and the details around it,  we basically starting Daybreak from scratch.

The only operation that we are currently running is the hatchery and the breeding section, and I can safely say about 500 jobs have been saved through that process.”

The company was formerly part of the Afgri Group and acquired in 2015 for R1.19 billion by a black empowerment consortium led by Matome Maponya Investments.

It had the backing of the Public Investment Corporation and was later fully taken over by the PIC in 2017.

Daybreak operates a fully integrated poultry value chain, spanning breeding, hatcheries, broiler farming, feed milling and the processing of both fresh and frozen chicken products.

But internal mismanagement, financial irregularities and non-compliance with environmental laws, such as operating without required water-use licenses, have crippled its operations.

The business rescue practitioner (BRP) notes the company has received a qualified audit opinion on its most recent financial statements, further underscoring the depth of its problems.

Despite the turmoil, the BRP believes there is a “reasonable prospect” for recovery.
A structured, three-phase plan has been set out:

Daybreak has secured funding from the PIC to cover critical operating costs and is continuing limited operations, such as breeding and hatching.

The company plans to restart select operations, including one abattoir and its feed mill, with the help of a new equity partner or additional funding. Retrenchments are expected during this phase.

The company aims to attract a strategic investor to fund a full return to operations.
Only at this stage will Daybreak be able to begin repaying creditors from generated profits.

“We’re on the path to seeking our strategic equity partner. And that process has a runway of around 18 months. So, I am confident that there will be some sort of support in saving Daybreak and also providing the required funding.” Maoto says.

The BRP has also commissioned an audit into past irregularities and is prepared to take action against any individuals found to have acted unlawfully.

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