Oromia agricultural cooperative acquires Assela Malt
In the opening of the bid on February 12, 2018, at the Ministry of Public Enterprise (MoPE), it was announced that three more firms had managed to submit their price offers besides the Federation. These were Calypso Agribusiness Ltd, Souflet Ethiopia PLC, and Malt Africa.
Following the Oromia Agricultural Cooperative Federation, the second highest offer, which is USD 42 million (1.1 billion birr), which came from Malt Africa, a sister company of Bavaria, a major Shareholder in Habesha Brewery SC. The remaining two bidders, Calypso and Souflet Malt, gave 977 million birr and 27 million dollars, respectively, to acquire the malt factory.
The offers made by all the interested companies were way above the initial price index of Assela Malt estimated by the Ministry. The initial price index was 866.7 million birr.
By the time of the bid opening, except Oromia Agricultural Cooperative Federation Ltd all the bidders proposed to settle 30 percent of the payment upon the signing of the acquisition and the rest after the transfer of the factory.
However, Oromia Agricultural Cooperative Federation, which managed to succeed in the acquisition, paid 35 percent down payment and it is expected to settle the rest within five years.
Established nearly 35 years ago, Assela Malt Factory is located in Oromia Regional State. The surrounding areas of the malt factory are also known for the high production of grains used for malt production. The factory is one of the major malt suppliers in the country along with Gander Malt Factory.
The current pair up capital of Assela Malt is around 232 million birr.
The acquiring Federation, on the other hand, was founded about ten years ago and it has around 40 Agricultural cooperatives unions as its member.
It is to be recalled that the Ministry over the past six months of the current fiscal year, reported that it has performed well according to its plan when it comes to transferring enterprises to a private ownership.
In this regard, though the Ministry planned to collect 1.7 billion birr revenue from the transfer of publicly owned enterprises, it has collected 12.7 billion birr.
This significant difference came mainly from the transfer of government’s 30 percent stake in the Ethiopian Tobacco Enterprise to Japan Tobacco with a total cost of USD 434 million.
Since its establishment in 1990s, the erstwhile Privatization and Public Enterprises Supervising Agency, which is now the Ministry of Public Enterprises, has transferred a total of 377 public enterprises to a private acquisition.