Prominent shareholders of Raya Brewery S.C. are in the process of establishing a subsidiary transport firm, hoping to distribute the brewery’s products come December 2014, where its first bottles off the plant dubbed Raya Beer is due to hit the market, sources disclosed to Fortune.
The trucking firm, RaAz Transport S.C., named after the area where the plant is located, will have an initial capital of 150 million Br, these sources told Fortune. However, the firm’s launching, decision on its initial capital and shareholders’ size will be tabled for the general shareholders’ assembly called in two weeks, Yemane (Jamaica) Kidane, one of the leading founders of Raya, told Fortune. He, nonetheless, declined from giving much detail on the company under the making.
“Only the founding members of Raya had a meeting to discuss the establishment of the transport company,” he told Fortune.
Other founding shareholders of Raya include Tsadikan G. Tensay (Lt. Gen.), former chief of staff of the Ethiopian army, and now chairman of the board of directors of Raya Brewery; Eyesuswork Zafu, prominent businessman, and Haile Asegedie, former senior minister in the EPRDF government, now industrial point man for Mohammed Ali Al-Amoudi (Sheikh).
It is most likely that RaAz will have 3,000 shares floated to shareholders and the larger public, each valued at 50,000 Br, sources disclosed. Among Raya’s shareholders, 2,400 are expected to buy shares in the new company, these sources said.
The transport sector is one of the areas restricted to investment to nationals, a factor that automatically bars foreigner shareholders in Raya. However, Raya hopes to enter into a market which increasingly becomes competitive, armed with its own transport fleet.
With the emergence of international bottlers in the domestic market such as Heineken and Diageo, and the presence of the domestic brands such as BGI and Dashen, the brewery industry becomes a cutthroat battlefield to the new entrants like Habesha, in Debre Brehan, and Raya. The existing breweries bottle 5.62 million hectoliter beer all together, while demand for bear is projected to grow by 15pc annually, much higher than the African average of five per cent recorded in 2014.
Raya Brewery was established in April 2010, with a registered capital of 2.5 million Br by 58 founding shareholders. Three years later, the company raised equity from the public in over 600 million Br, where BGI controls 42pc and an individual shareholder, Dawit G. Egziyabher, claims 25pc of the company.
Ray plans to launch production in three months with an annual output capability of 180 million bottles, from its production plant at Bohera Mountain, south of Maichew, 667km from Addis Abeba.
The transport company will become operational a week or two after the start of bottling, said sources.
FOR THE RECORD: This story has been corrected on some factual assertions after the print edition came out on Sunday, October 26, 2014.
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