Broadway gets Sh500m Barclays loan funding

KENYA – Bread maker Broadway Limited is set for a Sh1 billion expansion of its Thika milling plant that will be partly funded by Barclays Bank.

The expansion will double the production capacity of one of Kenya’s oldest bakery, having opened half a century ago.

Barclays Bank will provide a Sh500 million loan, while the balance will be funded through internal cash savings.

Managing director of the family-owned business Bimal Shah said in an interview that the facility is set to open next year.

“Barclays Bank has been our key financiers and they are part of this investment. Part of the cash will come from Broadway savings,” said Mr Shah.

The expansion will create jobs for 400 extra workers. It will increase production capacity to 500 tonnes daily.

Broadway Limited also has a wheat flour milling unit called Bakex Millers. It sells the Oboma and Vitafla wheat flour brands.The bakery currently has a workforce of 500 employees involved in production, sales and distribution.

It has a daily production capacity of 250 tonnes spread across all its brands.

Broadways bread brands include New Seneta, Broadways Premium, Sandwich Bread, Broadways Sliced White Sandwich Bread and Broadways Sandwich Bread.

The company sources wheat both from Kenyan farmers and imports from the USA, Canada, Argentina, Russia and Australia which they also sell to mini-bakeries in Thika, Nairobi and its environs.

Broadway is part of a family-owned business empire established in 1958 by two brothers; Ratilal Shah and Sobhagchand Shah.

The expansion of Broadway milling plant comes a time when its biggest rival Kenblest Group, also a bread maker based in Thika, announced last year that it will be setting up a Sh1 billion milling plant to expand the existing one.

Kenblest’s investment is expected to generate employment to 200 people, adding to the current 700.

Its construction has already started. Kenblest makes 330,000 loaves per day as per statistics given earlier by its management while Broadway produces 180,000 breads per day.

“The expansion of the milling plant will help us enter into new local markets,” said Broadway Business Development Executive Devan Shah during the interview.

Competition in the sector has become stiff after the emergence of small bakeries that are focused on cutting prices to attract customers to their brands.

July 13, 2015; http://www.businessdailyafrica.com/Corporate-News/Broadway-gets-Sh500m-Barclays-loan-funding/-/539550/2786616/-/weita2/-/index.html

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