Kenyan soft drink manufacturer Softa Bottling Company to close operations

KENYA – The Registrar of Companies in Kenya has issued a notice seeking to deregister soft drink manufacturer, Softa Bottling Company marking the end to the two decade company.

“It is notified that at the expiry of three months from the date of this gazette, the names of the undermentioned companies shall, unless cause is shown to the contrary, be struck off the register of companies and the company shall be dissolved,” read part of the notice in the Kenya Gazette.

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The company’s founder, Peter Kuguru, said that the closure is as a result of poor returns from the soft drinks maker. He said that he will shift his investment to a niche with attractive returns.

“We have been in many businesses, some succeed and others fail. But we never give up and when a business is not making the returns as required, you can always invest elsewhere. My spirit is not dampened,” Kurugu said.

Softa Bottling, whose flagship brands was Softa soda, predominantly found acceptance among low-income consumers taking competition to the global soft drink giant Coca-Cola in the east African country. 

The company also had ambitions to expand into the region and its products into the Common Market for Eastern and Southern Africa and the neighbouring Somalia.

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The veteran businessman bought Softa from Highlands Mineral Company in 1997 and after investing in new production lines, he launched Softa soda which came in different varaints of cola, orange, bitter lemon, lemonade and pineapple.

The firm had bad been an important player in Kenya’s soft drinks market estimated at over US$1 billion and dominated by Coca-Cola, Pepsi and Del Monte. Softa had unveiled plans of raising money through a bond to be listed on the Nairobi Securities Exchange.

Before the company stumbled, its annual turnover had grown to over US$7 million (Sh700 million) and had two manufacturing plants including a US$0.4m (Sh40 million) plant put up in 1997 and a US$ 1.15 million (Sh115 million) plant bought in 2003.

Last year, Mr Kuguru noted that competition had got stiffer for Softa, leading to hard times for a company which epitomised the possible success of homegrown enterprise.

As part of his efforts to bring back Softa to business, the company had also announced that it was seeking a joint venture partner but did not manage to successfully secure a partner.

This subsequently led to the firm announcing the sale of the business. By then, potential buyers were to acquire the whole business or buy the company’s assets.

Mr Kuguru says that not all the assets have been disposed and what is left of the plant is now owned by Kuguru Foods.

The veteran has diversified his business into other consumer goods and owns Cateress Milling company, which produces maize flour and Just Real Estate, a housing company.

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