French food processor Danone’s buyout of a minority stake in Brookside Dairy has lifted the lid on the private company’s financials, revealing the multi-billion shilling status of the group associated with President Uhuru Kenyatta’s family.
A joint statement released by the two companies announcing the buyout disclosed that Brookside made Sh15.4 billion (€130 million) sales last year, a figure that would rank it third among Nairobi Securities Exchange-listed manufacturers of fast-moving consumer goods. Danone on Friday announced it had bought a 40 per cent stake in Brookside Dairy.
EABL’s sales stood at Sh59 billion in the year ended June 2013 while BAT had a turnover of Sh19.6 billion in the year ended December 2013. Brookside, which was previously owned 90 per cent by the Kenyatta family, has been guarded on its financial performance.
The deal with Danone has given an insight into the size of the firm’s business, ranking it among the country’s top producers of consumer goods. Brookside, which is estimated to have a 40 per cent market share in the formal milk segment, has grown rapidly through acquisitions in the past few years.
Founded in 1993, it now has a distribution network of more than 200,000 outlets. It manages the largest milk collection network in East Africa, dealing with 140,000 farmers in the region.
Its product portfolio includes yoghurt, butter, fresh and powdered milk. The company last year acquired Buzeki – the producer of Molo Milk and Kilifi Gold – at a cost of Sh1.1 billion. Its other buyouts include that of Ilara, Delamere and SpinKnit (producers of Tuzo milk brand).
The acquisitions have made it the largest player in the packaged milk segment, with the entry of Danone expected to further fuel its expansion.
“By uniting Danone’s international expertise in fresh dairy products with Brookside’s regional expertise and robust supply chain, the partnership will enable Brookside’s growth acceleration by expanding its product portfolio and strengthening its geographical presence in key markets in the East African region, including Uganda and Tanzania,” the firm said in a statement.
Danone said it bought into Brookside as part of plans to expand in Africa where it has a presence in 40 countries through its dairy and baby food products. The multinational said it has invested Sh118 billion in Africa over the past two years.
Danone sees demand for its products in Africa being driven by its fast economic growth rates and a relatively younger population. It recorded sales of Sh177 billion from its African operations last year.