KENYA – Danone, the world’s leading food company has bought a 40 per cent stake in the holding company of Brookside Dairy, the biggest dairy firm in Eastern and Central Africa.
The buy-out which has been rumoured for some time now, enables Danone to ‘significantly enhance the platform Danone is currently building in Africa’ according to the press release availed by Danone.
The Brookside buy enhances the dairy group’s presence in Africa, especially the Eastern and Central parts of Africa and adds to its presence in other key African markets.
Brookside is the dominant player in the dairy sector in Kenya, where it has announced a bold plan to process over one million litres of milk a day at its Ruiru Plant. It currently produces fresh milk, UHT, butter, yoghurt, ghee and butter at the facility.
It has also recently commissioned a milk powder plant and added extra capacity to process other dairy products.
Related Article: Danone eyes Kenya’s Brookside Dairy
The company had ‘revenues of around €130 million’ in 2013 and ‘operates a unique distribution platform enabling a daily access to over 200,000 outlets. The company manages the largest milk collection network in East Africa, with 140,000 farmers in the region’, according to Danone.
The deal will build on Brookside’s ‘regional expertise and robust supply chain, the partnership will enable Brookside’s growth acceleration by expanding its product portfolio and strengthening its geographical presence in key markets in the East African region, including Uganda and Tanzania’.
Danone is a leading group in key areas of Fresh Dairy Products, Early Life Nutrition, Waters, and Medical Nutrition. It has over 190 production plants and around 104,000 employees.
In 2013, the company generated sales of over €21 billion, with more than 60% in emerging countries.
Africa is increasingly becoming an important market for Danone. Last year it completed the acquisition of a 49% stake in Fan Milk West Africa, together with the private equity fund partner Abraaj Group.
This gave the company a strong foot print in West African countries of Ghana, Nigeria and other countries where Fan Milk was already the leading dairy company.
The company also owns dairy operations in South Africa and in the North African countries of Morocco, Algeria and Egypt. It also distributes its infant nutrition products in several key African countries
Related Article: Danone, Abraaj in landmark Fan Milk purchase pact