The government has transferred 33pc of its remaining shares in Ambo Mineral Water to Ambo International Holding Ltd for 19.7 million dollars. The deal was made between the company and the Ministry of Public Enterprises (MoPE) on December 15 at the ministry’s premises, located in front of the old Emperial Hotel It is part of the government’s plan to transfer shares it owns in various companies.
“It is not our intention to co-own enterprises if the private shareholders have the capacity to fully acquire,” said Wondafrash Assefa, communication director of the Ministry.
This is the second biggest privatization deal when it comes to monetary value, in 2016. In July, 2016 the ministry sold 40pc government share at National Tobacco Enterprise at a record price of 510 million dollars in Ethiopia’s privatization history to Japan Tobacco International (JTI).
The deal to transfer the shares was sealed by Girma Amentie (PhD), minister of MoPE and Patrick Plunkett, commercial manger of the company. At the signing ceremony, the two state ministers, Beyene G Meseqel and Meselche Wodajo and Ambo board chairman and shareholder, Tewodros Ashenafi, were present.
Established in 1930s, Ambo was nationalized during the Derg regime. In 2008, the company was partially privatized to the South African brewery company, SABMiller and Tewodros. At the time, SABMiller owned 51pc of the company while Tewodros owned 16pc.
The latest agreement will allow Ambo Ltd to take over 84pc of the shares of the company.
Currently, Ambo is valued at around an estimated 60 million dollars. With around 460 employees, the company has reached a production capacity of 26,000 glass bottles and 10,500 plastic bottles per hour. The factory is located in Sekele locality, 130 km west of Addis Abeba.
“In the future we will focus on brand innovation and increasing our capacity,” Plunkett told Fortune.
However, Ambo will remain Ethiopian with its brand integrity, he said.
The company bottles its flagship brand mineral water, as well as Ambo Lite (lower carbonation and mineralization) and Ambo Flavored Water (Orange, Apple, Pineapple, Lemon-lime).
In addition to serving the local market, the company is now looking for more export markets.
At the moment, the company exports two percent to three percent of its business to the international market. In the next three years, Ambo aspires to raise the figure to eight percent.
Ambo Holding is expected to settle 100pc of the transfer price within seven days.
Source - Fortune