Companies

Eveready in partnership bid with Orbit Chemicals

MUTUA

Jackson Mutua, Eveready EA managing director. PHOTO | FILE

Eveready East Africa is set to enter into a joint venture with manufacturing firm Orbit Chemicals that will see the battery maker deepen its diversification by producing more personal care products.

The Nairobi Securities Exchange (NSE)-listed company has, in a notice, indicated that it will seek shareholder approval mid next month to form a joint venture company of equal stakes with Orbit Chemicals with the aim of producing common goods.

Orbit Chemicals is a 43-year-old company that primarily supplies industrial chemicals to several firms while also manufacturing soaps, petroleum jelly, hand gels, detergents, fertilisers, liquid detergents and washing powders.

The notice states that Eveready will be seeking shareholders’ authorisation “to acquire 50 per cent common equity in a company to be set up under a joint venture arrangement with Orbit Chemicals Limited for the purpose of pursuing common business interests.”

Mr Jackson Mutua, Eveready’s managing director, told the Business Daily last week that the company plans to launch a new line of products in the next five months to advance its diversification, which has seen it move away from over-reliance on production of dry cell batteries.

“We plan on unveiling new products in the personal care category by September as part of our efforts to grow our portfolio,” he said, while declining to elaborate on specific types of products they plan to launch.

Eveready reported a Sh177.5 million loss for the year to September, down from the previous year’s net profit of Sh45 million. The firm, which was forced to close its Nakuru plant last year, began selling automotive-type lead acid batteries under the brand names Turbo and Turbo Plus.

It also ventured into making industrial lighting bulbs, fluorescent tubes and energy-efficient bulbs under its brand name Eveready in a bid to expand its existing portfolio of batteries and shavers.

The company has also announced plans to make its debut in the real estate sector, adding that is has received bids from potential investors — both local and international — to fund its multi-billion shilling projects.

Eveready will this month complete feasibility studies on whether to build a hotel, shopping complex or a housing project on the 18.5 acre piece of land where the obsolete plant sits.

READ: Eveready in real estate funding talks with three investors

During the May 14 AGM to be held in Nakuru, the company will also ask for the green light to sell idle equipment in the defunct factory to finance its diversification drive.

“The company is authorised to liquidate the unutilised equipment on the property in order to raise capital to diversify into new businesses in accordance with the Strategic Plan 2013-2017,” says Eveready in the AGM notice.