BMC, the local brewer of Skol beer have refuted claims that it plans to sell off its business to East African Breweries Ltd (EABL) but instead announced that it has acquired new equipments to boost its production capacity.
BMC, the local brewer of Skol beer have refuted claims that it plans to sell off its business to East African Breweries Ltd (EABL) but instead announced that it has acquired new equipments to boost its production capacity.
Sources close to EABL told Business Times that BMC was in talks with the Kenyan based beer maker over a possible takeover deal that would translate into a duopoly of Bralirwa and EABL.
The deal, according to the source that spoke on condition of anonymity because they are not authorised to speak on behalf of either company, is part of EABL’s drive to expand its foothold in the region, particularly Central Africa.
According to the source, EABL mulls-over a US$200m investment in Rwanda or Burundi, as part of its regional investment plan and thinks that BMC is a strategic venture that would boost this drive.
However, Thomas Weingarten, the Managing Director of BMC, said these are just ‘rumours’ and that BMC has never entered talks to sell off its factory to EABL.
Efforts by Business Times to secure a comment from EABL were fruitless by press time.
He said BMC is investing in new equipments as it seeks to capture a lager market share of Rwanda’s beer industry.
BMC is also believed to have entered negotiations with EABL with the former seeking rights to produce some of the latter’s products.
According to the source, this could not work as BMC later opted to increase its capacity to capture more market share.
BMC is optimistic that Skol will gain extra share of 25 per cent of the beer market in the country. The company currently holds around 16 to 17 per cent of premium beer market.
Weingarten noted that the new equipments are expected to increase the brewer’s production capacity above 100,000 hecta litres per annum.
"We anticipate growth in the industry next year and we are participating in this growth, this is why we are expanding,” he told Business Times last week.
Competition in the beer market is set to intensify after the country’s leading brewery by market share, Bralirwa, announced it intends to boost production above 1.3m hecta litres next year and expand outside Rwanda.
Currently, Bralirwa exports its products to Uganda and parts of Tanzania.
J’damour Rutayisire, a businessman says that the competition will help reduce beer prices and give people more choice and as well boost the hotel, restaurant and bar businesses.
According to analysts, Rwanda’s beer industry, which witnessed a drastic shift from Bralirwa’s monopoly, is set for tighter competition next year.