EABL’s mini-IPO opens tomorrow

BY GEOFFREY NANGAI

THE East African Breweries Limited (EABL) will tomorrow morning open its Initial Public Offering (IPO) for its existing 20 percent shares in Tanzania Breweries Limited (TBL), the company has confirmed.

A statement released by the company yesterday did not however give details of the offer price of the shares during the mini-IPO insisted that such details would be made public as the IPO opens today following an approval from the Capital Markets and Securities Authority (CMSA) on October 17, 2011.

EABL is one of the few companies trading at various bourses in the East African region, having listed on Dar es Salaam Stock Exchange (DSE) in 2005, the Nairobi Stock Exchange (NSE) in 1934, Uganda Securities Exchange (USE) in 2001.

EABL wants to end a manufacturing and distribution agreement with TBL, a subsidiary of its rival SABMiller, to buy a bigger stake in Serengeti Breweries (SBL) and boost its presence in Tanzania.

Reports indicate that the Tanzania Fair Competition Commission had ruled that EABL should sell its shares in TBL to the public as a condition for approving the Serengeti deal.

TBL had published a public notice in a number of local newspapers on October 24, this year indicating that the public offer was to be opened on that day.

Analysts say EABL’s move is geared towards making it the largest East African brewing company owning 80 per cent of Kenya Breweries, 98.2 per cent of Uganda Breweries and 51 per cent of Serengeti Breweries limited (SBL) in Tanzania.

The company was incorporated as a private company in 1922 under the name Kenya Breweries Limited. In 1926 the first dividend was declared, and in 1931 the first bonus share issued.