UGANDA – Giant milk processor Brookside Dairy has taken its appetite for acquisitions to Uganda, buying out Sameer Agriculture and Livestock business for Sh3.5 billion.
The government of Uganda which owns 49 per cent stake in the firm confirmed this week that Sameer had finalised transfer of its shares to Brookside on March 25.
“I can confirm that the assets of the government of Uganda have remained to the best of my knowledge. But those of Sameer are the ones that have been transferred to Brookside” the Uganda ministry of finance spokesperson, Jim Muguga said.
Brookside which is owned by the Kenyatta family has been on bullish acquisitions over the last two years in Kenya, in a move that saw it acquire smaller processors such as Buzeki which used to manufacture Molo Milk brand, Ilara Milk Company and SpinKnit Dairy, the former producer of Tuzo milk.
Sameer Agriculture and Livestock Ltd – Sall – was established as a joint venture company by the Sameer Group of Kenya and RJ Corporation of India and took over of the former government parastatal Uganda Dairy Corporation in August 2006.
The latest deal between Brookside and Sall has caused furore in Uganda because of what the public sees as selling off of public assets to foreign firms, for a low price.
Sameer acquired the corporation shares in 2007 from a Thai-based firm Malee Sampran Plc which had earlier bought it from government at a throw- away price of one dollar during the privatisation process in 2004.
After public protest and parliamentary committee recommendations, government allowed Sameer to run the dairy plant on its behalf for 10 years up to 2017, with the expectation it would then be transferred to a local company.
However, last year Sameer requested for a 50-year extension to recover its investment of Sh6 billion (UGX 47.7 billion), which it said was thrice what had initially agreed upon with the Ugandan government. It was granted a 40-year extension.
Brookside, which also had established operations in Uganda prior to latest acquisition, has in the past attracted criticism for retailing imported Kenyan milk at the expense of Ugandan farmers.
Brookside Kenya did not immediately comment on the deal with Sameer but said it will give a comprehensive response on Monday.
Sameer’s brands in Uganda are Fresh Dairy and Daima with a range of fruit juices and mineral water.