Centum Group will no longer be in charge of distributing alcoholic beverages Carlsberg and Tuborg after it let go of King Beverage Ltd.
The alcoholic distributor has been sold to the Danish Brewing Company East African Limited, bringing an end to Centum’s four years of distributing various alcoholic beverages, key of which were of Danish origin.
Centum Group Managing Director James Mworia announced that the investment company, which held 100% shareholding in King Beverage Ltd, had completed the sale of its beverage distributor subsidiary.
“Centum is pleased to announce that it has completed an agreement to sell all its shareholding in King Beverage Limited to Danish Brewing Company East Africa,” Mworia said in a statement.
Danish Brewing Company, which is a private limited liability company incorporated in Kenya, is a subsidiary of Bounty Global Management, the Centum Group MD said.
Centum Group, an investment company listed at the Nairobi Securities Exchange (NSE), has been distributing Carlsberg beer in Kenya since 2015. “We are targeting the premium beer market segment. There is space for growth given that Kenya’s per capita consumption of beer remains very low,” Centum chief executive James Mworia told the Business Daily in 2015.Through its subsidiary King Beverage Limited, the investment firm which is also behind the development of the Two Rivers Mall, has been distributing the Danish brewed beer. It has also been distributing Tuborg, the Danish beer which was acquired by Carlsberg Group in 1970.
Carlsberg Group is ranked as one of the largest brewers in the world and was founded in the Danish capital of Copenhagen in 1847.
The sale of Centum alcoholic beverage firm comes after the investment company also sold off two of its non-alcoholic beverage distributors to Coca Cola. The two beverage firms, Almasi Beverages and Nairobi Bottlers Ltd, were sold for ksh19.5 billion.
Beer in Kenya
Beer distribution in Kenya is dominated by listed firm East Africa Breweries Limited (EABL), which recently posted a full-year profit of ksh11.5 billion for the year ended June 2019.
The alcoholic beverages manufacturer, famous for its brand Tusker, had also said that net sales in bottled beer grew by 8%. “A combination of higher volumes in bottled beer and mix improvement across brands and categories delivered higher margins.”
EABL’s board of directors also recommended a final dividend of Ksh6.00 per share, resulting in a total dividend of Kshs 8.50 per share. This dividend payout increases from Ksh7.50 per share a year ago.
The largest alcoholic beverages distributor in Kenya has however been engaged in so called Beer Wars in the country, with global firms continuously setting up shop in the country.
Previously, the firm had to fend off Castle Lager which was operating in Kenya under South African Breweries (SAB Miller).
Beyond Carlsberg, distributors of Dutch lager Heineken and America’s Budweiser have also made it into the Kenyan market.
At the same time, local brewers Keroche Breweries, owned by Dr. Tabitha Karanja, has also been in the market seeking to compete on the beer manufacturing front.
Written by Mike Njoroge for Business Today