The Competition Authority of Kenya has approved the acquisition of a controlling stake in Almasi Beverages Limited by CCBA subsidiary, Coca-Cola Sabco East Africa Limited (CCSEA) from Centum Investment. The transaction is subject to several conditions.
CCSEA is an investment holding company which holds shares in various bottling companies i.e. Nairobi Bottlers Limited, Crown Beverages Limited and Equator Bottlers Limited. The company is in the business of preparation, packaging, distribution and sale of a range of non-alcoholic ready-to-drink beverages. CCSEA is a subsidiary of Coca-Cola Beverages Africa Proprietary Limited (CCBA), a South African company.
Almasi Beverages Limited has three subsidiaries in Kenya namely; Almasi Bottlers (Mt. Kenya Bottlers), Kisii Bottlers and Rift Valley Bottlers.
In Kenya, the main players in the ready to drink non alcoholic drinks sector and their market shares are as follows:
Kevian Kenya (4.76%)
Excel Chemicals (2.29%)
Del Monte (1.42%)
Others, including imported brands, (19.46%).
The conditions of the approval by CAK for the CCBA acquisition of Almasi are;
CCBA will continue to operate the current bottling plants of the Merged Entity in Nyeri, Eldoret, Nairobi, Molo and Kisumu for at least three (3) years after completion of the proposed transaction.
The merged entity shall reserve the lower deck, or not less than 20% of the total storage space of the coolers lent to SMEs for products of competitors except the brands of the Coca-Cola Company’s three (3) largest global non-alcoholic ready-to-drink competitors.
The merged entity shall for a three (3) year period following completion of the proposed transaction retain 1,749) employees of the total 1,760 permanent employees.
The merged entity shall honour the existing agreement with Coastal Bottlers
CCBA shall within nine (9) months of completion of the transaction amend the agreements between the merged entity and its distributors to permit such distributors to distribute other non-alcoholic ready-to-drink.
CCBA shall within nine (9) months of completion of the transaction amend the agreements between the Merged Entity and its distributors to remove all clauses which stipulate the prices and profit margins for the sale of its products, to the extent (if at all) the agreements contain such clauses. However, the merged entity should retain the ability to set maximum recommended resale prices for its distributors.