RCL, which owns brands such as Selati sugar, Ouma rusks and Rainbow Chicken, has been reviewing its portfolio to assess whether it is configured to deliver sustainable earnings and value for shareholders.

Among the resulting conclusions, RCL resolved to bulk up its fast-moving consumer goods business through acquisitions while separating its chicken, sugar and Vector Logistics into separate legal entities to operate in a pure-play environment. Vector was eventually sold last year.

On Monday, RCL said the board provided its preliminary approval on March 1 "to pursue the formal separation of Rainbow via an unbundling to shareholders and a concurrent listing on the JSE (Johannesburg Stock Exchange).

"The board is of the view that the unbundling of Rainbow will enable both businesses to pursue their respective growth ambitions and investment theses in a focused manner and with improved alignment on capital allocation priorities," the food producer added.

RCL reported headline earnings per share from continuing operations - a profit measure - of 81.2 cents for the six months ended December, up from a restated 53.2 cents posted a year earlier.

Earnings before interest, taxes, depreciation, amortisation and impairments (EBITDA) rose by 48.6% to 1.5 billion rand ($78.48 million), while revenue rose by 8.4% to 20.1 billion rand, largely due to higher volumes in Rainbow, higher sugar prices and the inclusion of the Sunshine bread bakery business.

($1 = 19.1122 rand)

(Reporting by Nqobile Dludla; Editing by Clarence Fernandez and Janane Venkatraman)