ETHIOPIA – Nestlé Water Ethiopia, a wing of the Swiss multinational company, has sold back all its 51% share in Great Abyssinia Spring Waters after three years of partnership, exiting the water business in Ethiopia.
Tewdros Zerihun, Gobezayheu Zerihun and Dawit Zerihun, the owners of Great Abyssinia, transferred the majority share of the company to Nestle Water back in 2016.
The financial transaction for the transfer of the shares has not been disclosed but the move is part of the food company’s global water business restructuring.
“We review our business operations regularly to ensure that we continue to deliver sustainable results,” said Bethlehem Hailu, corporate affairs & sustainability manager for Asia, the Middle East and Africa at Nestlé Waters. “We’re making changes to our bottled water businesses globally and this is reflected in Ethiopia.”
To further accelerate profitable growth and create synergies, Nestlé also plans to integrate the Nestlé Waters business into the group’s three geographical zones.
The world’s leading food and beverage firm, last year announced changes in its waters business and unveiled plans of returning as much as US$20.1 billion to shareholders by 2022 through a new stock buyback program.
Nestlé said that that it will start a new share buyback program in January and may complement it with special dividends over the next three years.
Following the departure from Ethiopia, Nestle has laid off 17 employees from the head office after compensating them.
However, there has been no impact on the employees at its manufacturing site in Sululta, and the terms and conditions of their employment agreements remain unchanged.
Nestle Ethiopia commenced operations in 2006, serving as the headquarters of subsidiary Nestle Horn of Africa Cluster that oversees market development across Djibouti, Eritrea, Ethiopia and Somalia.
The company also transferred the landscape management rehabilitation project to Great Abyssinia Spring Waters.
It took up the project in partnership with the Oromia Regional Government and the Water & Land Resource Center of Addis Abeba University.
A research contract for the project, which included a 3.5 million Br (US$109,000) grant from Nestle Ethiopia to hire 20 researchers and surveyors, has been progressing for two years.
Nestle Water built a water station in Sululta that provides 20,000lt of water a day to the surrounding community. In partnership with the town municipality, the bottler managed to dig two deep wells, which are owned by the municipality, to enhance the flow of the water to meet the city’s demand.
Great Abyssinia was founded in the early 1990s with a sole owner called Abyssinia Tea & Coffee Enterprise that had 10,000 Br (US$312) in initial investment capital, an old and rundown machine and 10 employees.
Now it has ventured into multiple businesses ranging from coffee export, water and soft drink bottling, juice processing and operating a commercial plaza.
Great Abyssinia Spring Waters, which was established in 2007, sources the water from the plant located in Sululta, near the capital. Currently, the plant operates with 213 employees in the country, reports Addis Fortune.