, NAIROBI, Kenya July 18 – French dairy giant Danone has struck a deal to buy 40 per cent stake in Brookside Dairy Limited which is owned by the Kenyatta Family.
The Wall Street Journal reports that this is part of the plan by the French Dairy to expand its footprint in Africa and allow Danone to enter in one of Africa’s largest milk markets.
Brookside, which is the dominant player in Kenya’s dairy market had sales of an estimated Sh15.4 billion shillings in 2013, according to Standard Investment Bank research.
The company is known to have the largest milk collection network in East Africa with over 140,000 farmers and a distribution network of more than 200, 000 outlets in East Africa.
Brookside’s portfolio of products includes; UHT milk, powdered milk, yoghurts, fermented milk, ghee and butter.
In the recent past, Brookside has been involved in several takeover bids including Buzeki Dairy, Ilara, Delamare and SpinKnit that have made the company’s market share in Kenya rise to 44 percent, making the company the Market leader.
According to the research firm, Brookside has announced plans to acquire a 20 percent stake in Ethiopia’s Elemtu dairy in a bid to expand further in the East African market.
It also reports that Danone, which generates about 60 percent of its turnover from emerging markets, has been investing in the African market to expand its footprint in the market.
“Danone in 2013 acquired 49 percent stake of Fan Milk, which is the leading manufacturer and distributor of frozen dairy products and juices in West Africa as well as took control of Morocco’s top dairy firm, Centrale Laitiere,” the research firm states, adding that the Brookside takeover will leave Abraaj Group (Danone’s partner in Fan Milk) with 10 percent stake while the Kenyatta family will remain with 50 percent stake.