East African Breweries Limited (EABL) will open a new plant in Kisumu, Kenya at a cost of Kshs.15 billion. The announcement follows a commitment made by Mr. Ivan Menezes, the CEO of Diageo – of which EABL is a subsidiary – in a meeting at State House Nairobi this morning.
The new brewery construction, earmarked for production of Senator beer, will be launched on July 16, 2017, and is projected to start operating within the next 18-24 months.
The investment, the single largest in decades, is expected to open a significant socio-economic lifeline for the Nyanza region and Kenya at large, creating over 100,000 direct and indirect jobs to support its expansive value chain. The meeting was also attended by Diageo Africa President John O’Keeffe, EABL Group MD, Andrew Cowan and KBL MD Jane Karuku, among others.
Speaking on the announcement, the President said: “This multi-billion-shilling commitment by the EABL underlines the strong confidence driving local and global investors in Kenya with significant multiplier effects to the Kenyan economy in future. I’m especially delighted by the projected benefits resulting from this investment, potentially doubling the demand for sorghum and millet in Kenya and recruiting over 15,000 farmers in the process with guaranteed market for the crop.”
Mr. Menezes said: “This investment in a new brewery for Senator Keg underlines our long-standing commitment to Kenya. This announcement now brings our incremental capital investment to Kshs 30 billion over the last five years and further deepens our relationship with Kenya which has now spanned 95 years.
Once complete, this new brewery will increase the production capacity of the now iconic Senator Keg, which will in turn provide socio-economic benefits, including helping to reduce the consumption of illicit brews.”
The Kisumu facility, on which the new one will stand, started operations in 1984 but was closed in 2002 due to improvements in beer-production technology that helped create excess capacity in beer production at the Nairobi brewery.
The re-opening will help plug fresh demand for Senator, a hugely successful beer product launched in 2004, targeted at the low-end of the market. EABL has developed a robust value chain supporting Senator’s production, and the latest investment will expand the number of contracted farmers from the current 30,000 to 45,000.
The Nyanza region climate is among the most conducive for sorghum and millet production and the proximity to the plant will further benefit the local farmers more. Gross additional farmer earnings are expected to reach over Kshs. 6 billion annually over the next 10 years boosting rural economies.