Companies

Centum gets Kenya dealership for the high-end Courvoisier cognac

mworia

Centum CEO James Mworia. PHOTO | FILE

Centum has signed a distributorship contract with one of the world’s premium alcoholic spirits makers in a deal that will see one of the NSE-listed firm’s subsidiaries exclusively market brands like Courvoisier and Jim Beam locally.

King Beverage, a subsidiary of the Nairobi Securities Exchange (NSE) traded Centum, will solely distribute the portfolio of Beam Suntory, a $4 billion (Sh408 billion) spirits maker based in Illinois.

Centum is already the exclusive local distributor for Danish brewer Carlsberg. The latest partnership was signed through Edrington Fix Middle East (EFME), a joint venture spirits distribution business operating in the Middle East, the Gulf and north Africa.

“The potential of the Kenyan market is obvious, but finding the right partner for the Beam Suntory portfolio to craft a new story in East Africa was a priority for us,” said Igor Boyadijian, the EFME managing director.

Under the deal, Centum will also distribute brands like Knob Creek bourbon, Teacher’s, Yamazaki and Hakushu whiskies among other brands as it seeks a piece of the lucrative market currently controlled by the Diageo-backed East African Breweries.

Some of these drinks are presently available locally through independent distributors, whose business relationships will however be terminated after Centum’s takeover.

Centum declined to disclose the value of the deal, saying it is “long-term” in nature, restricted to Kenya and that the products to be distributed will cost between Sh2,000 and Sh7,000.

A cognac, such as the Courvoisier drink, is a brandy variety made using grapes while bourbons like Jim Beam are whiskies primarily distilled from corn.

“I am confident that we will make history together with Beam Suntory teams working hand-in-hand to build and grow our exciting portfolio of bourbons, cognac and single malts,” said Mr Boyadijian.

Centum entered the beer market mid-2014, signing a deal with the Carlsberg Group to exclusively sell its beer brands in Kenya as it mulled setting up a beer bottling plant.

READ: Centum enters beer market with Carlsberg franchise

King Beverage has since established a countrywide distribution network at bars, restaurants and supermarkets.

Centum’s distributorship of international brands is in line with its strategy to diversify revenue streams, one that will see it jostle for consumers in a market dominated by EABL.

“Our goal is to work with like-minded international partners to tap into the growing consumer base and create value not only to our shareholders, but to our consumers and customers,” said John Ngelu, the King Beverage general manager.

Beam Suntory is the world’s third-largest spirits maker with a wide portfolio that includes bourbons, whiskies, vodkas, rums, tequilas, cordials, cognacs as well as gins.

The firm, which brings together American and Japanese brands, has entered into partnership with Centum at a time when consumption of spirits in Kenya is on the increase.

A 2013 research by the Scotch Whisky Association (SWA) showed that Kenyans guzzled approximately half a billion shillings worth of Scotch that year, up from Sh293 million the previous year.

EABL, which sells premium spirits that include Smirnoff Vodka and high-end drinks such as Johnnie Walker Blue Label, have posted sustained double-digit growth.

It has responded to increased competition by launching new products to tap into this market. The regional brewer has recently launched brands such as the Talisker Storm and Talisker 10, premium whisky products whose retail price is over Sh5,000 for a 700ml bottle.

Beam Suntory is keen on getting a piece of this pie, choosing to partner with one distributor with the financial, distribution and marketing muscle to push its products as opposed to making sales through multiple independent firms.