Ethiopia: Heineken Beer Sees Double for Its Distribution

Heineken Holding, which claims to sell its famous beer in 170 countries, renewed its contract with its former distributor, Solomon Kidane, and signed another contract with Kangaroo Plast Group Plc, on January 22, 2010, to handle 75pc of the distribution, according to a representative of the latter.

"We agreed that Kangaroo would distribute 75pc and Solomon 25pc," said Efrem Yirga, one of the shareholders in Kangaroo Plast.

His company expects big sales for the beverage which he says is in high demand in Ethiopia.
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Kangaroo Plast is under the Kangaroo Industrial Group, which is a family of eight companies. It acquired the majority share of the distribution of Heineken through the company it established to enter the brewery business.

"We shall try to distribute it more widely by making an adjustment to the price," Efrem said.

Kangaroo Plast has also been at work to start its own brewery. In 2007, it leased land in Mojo Town, 73km from Addis Abeba in the Oromia Regional State, to establish a brewery with an annual production capacity of 300,000 hecto litres (3 billion litres) using a capital of 200 million Br. That capacity, the company said, would grow to 500,000 hecto litres (5 billion litres) in a year's time.

"We are still undergoing construction," said Efrem.

The company has started a search for international companies that would like to enter into a joint investment agreement with it, he added.

"We are looking for a partner because we felt that we needed to take advantage of a technology transfer in time before the market floods with very large breweries," Efrem said.

There are five breweries in Ethiopia including the state owned Meta Abo, Bedele and Harar, and two privately owned ones, Dashen, which is owned by the Endowment Fund for the Rehabilitation of Amhara (Tiret) and BGI Ethiopia, owned by French investors.

Source: AddisFortune
Wudineh Zenebe