Dutch brewer entry raises stakes for Kenya’s big brands

KENYA – Netherlands’ third-largest beer maker, United Dutch Breweries (UDB), has entered the Kenyan market bringing its key brands such as Royal Dutch Posthorn, Atlas and Trio Stout to local outlets.

The brewer has appointed a Kenyan distributor hoping to grab a piece of Kenya’s lucrative beer market currently dominated by the Diageo-owned East African Breweries Ltd.

UDB — owned by Belgian private equity firm Gimv — says it sees high growth opportunities in Nairobi.

The group is banking on its five-century brewing history and a pricing strategy that is aligned with local brands to win market share in Kenya.

“Kenya is an exciting market and we are pleased to launch our products here. The variety of our product portfolio ensures that we have drinks that are affordable across all market segments. There is something for everyone,” said Sander Bos, UDB sales manager for Africa.

Mr Bos said the Royal Dutch Posthorn and Trio Stout beers are available in Kenya in both 500ml cans and 330ml bottles; while Atlas will retail in half-litre cans.

UDB is ranked the third-largest beer group in the Netherlands after Heineken and Bavaria; with annual turnover grossing €77 million (Sh8.6 billion) on volumes of 1.2 million hectolitres last year.

The company does not own breweries, but outsources production, and markets its more than 20 brands of lager, strong beer, non-alcoholic malt, dark malt beverage, and specialty beer in more than 100 countries.

UDB was the export department of Anheuser-Busch InBev — the world’s largest brewer — and was carved out in 2007 as an independent company.

Jovet Kenya Ltd, the local distributor, was previously the supplier of Bavaria beer, but the two parties fell out after the Dutch brewing giant terminated the Kenyan distribution contract. The matter is in court.

The firm is using its countrywide distribution network to ship UDB’s beer brands at retail points.

Daniel Munene, proprietor of Jovet Kenya Ltd, said the Atlas range of strong beers is likely to find favour with the low-income earners who want to drink imported beer on a budget.

“It is ideal in curbing the use of illicit brews and second-generation liquor because taking one is like taking three to four normal beers at the price of one,” said Mr Munene.

Atlas’ range of strong beers comes with alcohol content ranging from 8.5 per cent to 16 per cent. Tusker has an alcoholic content of 4.2 per cent, while Summit Lager’s is 5.0 per cent.

June 4, 2016; http://www.businessdailyafrica.com/Corporate-News/Top-Dutch-brewer-entry-raises-stakes-for-Kenya-s-big-brands/-/539550/3229876/-/qpnyt5z/-/index.html

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