EABL buys top Tanzanian brewer

By James Anyanzwa and Agencies

Tanzanian Fair Competition Commission (FCC) has approved East African Breweries Ltd (EABL) acquisition of a majority interest in Serengeti Breweries Limited (SBL).

In a statement, Thursday, EABL said the transaction was, however, still subject to certain conditions.

"SBL and EABL are fully committed to working with the FCC to satisfy these conditions," said EABL.

SBL is Tanzania’s second largest brewer and the maker of Premium Serengeti Lager.

Growing portfolio

"Through this important investment, EABL is committed to growing SBL’s portfolio and footprint in Tanzania and beyond and SBL will form an integral part of EABL’s operations in East Africa," said EABL

"We see this deal as a partnership between EABL and SBL. EABL recognises the great achievements made by the management of SBL in growing the company and its brands."

The Diageo Plc-owned EABL has acquired a 51 per cent stake in Tanzania’s second-biggest beer maker, other sources said.

Some of the conditions require EABL to sell its 20 percent stake in rival Tanzania Breweries Limited before the purchase is completed.

Diageo owns 43 per cent of EABL, which is Kenya’s second- biggest company by market value, according to Bloomberg data. EABL is targeting an initial market share of 30 per cent upon buying the Tanzanian business.

EABL must also continue to promote Seregenti’s corporate identity for five years after the effective date of the merger and not close any of Seregenti’s existing plants without prior approval from the commission, it said. "East Africa Breweries shall submit for the next five years after effective date of the merger an annual progress report of compliance with the investment strategy plan submitted during the application of the merger and an annual progress report of compliance with these conditions," said a statement by FCC.