Privatisation of breweries – here we go again
In case you are interested, bids have to be submitted in “wax-sealed envelopes to the privatisation agency before 28 March 2011.” Yep.
On 26 January 2011 Ethiopia’s privatisation agency officially invited bids for two of its breweries. The government currently owns 100 percent of equity in the Harar and Bedele breweries and intends to sell at least 51 percent of these enterprises to an investor or a group of investors ready and capable of operating and developing them. But there is no need to get overexcited that these breweries will definitely be sold this time. They have been put on the market before. As previously, the agency reserves the right to reject any or all bids.
Bedele Brewery, located 500 km west of the capital Addis Ababa was opened in 1993 and has an annual production capacity of 75 million bottles, while Harar Brewery, located 500 km east of Addis Ababa, was established in 1983 and has a capacity of 67 million bottles (330 ml each), it was reported.
With an estimated consumption of 3.1 million hl and a population of nearly 80 million people, annual beer consumption per head in Ethiopia is only around 4 litres. The beer market is dominated by BGI Ethiopia, which is owned by France’s Pierre Castel, a monopolist brewer in many African states. BGI has a share of around 50 percent nation-wide and even higher in Addis Ababa, where it operates the St. George brewery.
According to African media, several investors are keen on bidding for these breweries, among them Ethiopia’s Kangaroo Plast Group, which has been Heineken’s distribution partner since January 2010.
Kangaroo Plast Group has been planning to build its own brewery in Ethiopia for the past four years.
African media also claim to know that the privatisation agency is currently reviewing offers for its Meta Abo brewery, the biggest of its state-owned breweries. Winning bidders are expected to make a 35 percent down payment, with the outstanding amount to be paid in five years. Winners are also required to initially retain the employees.
This being Ethiopia, we shall refrain from predicting the outcome of this latest round of privatisations.
