Shumuk buys majority share in Alpha Diaries
Feb 28, 2010
Shumuk Group has bought a 61% majority share in Alpha Diaries, Uganda’s second largest dairy firm, at $1.2m (sh2.5b).
By Barbara Among
Shumuk Group has bought a 61% majority share in Alpha Diaries, Uganda’s second largest dairy firm, at $1.2m (sh2.5b).
The deal for the take-over was reached on Friday at the headquarters of the plant in Mbarara district.
Kabu Auctioneers and Court Bailiffs on behalf of the Zimbabwean owners, Dairibord Holdings, signed a memorandum of understanding with Shumuk officials.
According to the Shumuk head, Mukesh Shukla, the company will invest $5m (sh10b) into refurbishing the plant.
“We signed the agreement and the plant will be operational within two months.â€
Mukesh disclosed that the diary plant will also change names from Alpha Diaries to “Go Freshâ€.
The plant’s products will range from milk, yoghurt, cheese, butter to milk powder.
Shumuk management, however, said their focus would be the export market.
“We are going to improve the products and will target the regional market and beyond,†he said.
It initially targets to produce 50,000 litres of milk per day.
Officials said Shumuk would maintain the milk collection centres and the farmers who have been supplying the firm.
Shumuk plans to set up 200 milk collection centres at parish level to ensure a consistent supply chain. It also hopes to engage up to 50,000 farmers for the start.
Dairibord Holdings, bought 61% of Alpha Diaries two years ago from the late Ace Riyaz Kurji but shut down its milk processing factory in Uganda and put up its equipment for sale last August.
Kabu auctioneers were hired in May 2009 to auction the sale of the company and recover debts owed to DFCU Bank.
Shumuk emerged the highest bidder in the deal with a $1.2m offer.
Diariboard’s investment in Alpha Dairies hit a snag following its inability to secure capital.
Its $6m (sh1.2b) investment was never profitable since its establishment in 2007, forcing it to close last year.
The company supplied dairy products to Burundi, the Democratic Republic of Congo, Kenya, Rwanda and Sudan.
Sources said Diariboard expanded too fastwhen it made an ill-funded acquisition in Uganda to escape price controls and deteriorating business in Zimbabwe.
Shumuk Group has bought a 61% majority share in Alpha Diaries, Uganda’s second largest dairy firm, at $1.2m (sh2.5b).
The deal for the take-over was reached on Friday at the headquarters of the plant in Mbarara district.
Kabu Auctioneers and Court Bailiffs on behalf of the Zimbabwean owners, Dairibord Holdings, signed a memorandum of understanding with Shumuk officials.
According to the Shumuk head, Mukesh Shukla, the company will invest $5m (sh10b) into refurbishing the plant.
“We signed the agreement and the plant will be operational within two months.â€
Mukesh disclosed that the diary plant will also change names from Alpha Diaries to “Go Freshâ€.
The plant’s products will range from milk, yoghurt, cheese, butter to milk powder.
Shumuk management, however, said their focus would be the export market.
“We are going to improve the products and will target the regional market and beyond,†he said.
It initially targets to produce 50,000 litres of milk per day.
Officials said Shumuk would maintain the milk collection centres and the farmers who have been supplying the firm.
Shumuk plans to set up 200 milk collection centres at parish level to ensure a consistent supply chain. It also hopes to engage up to 50,000 farmers for the start.
Dairibord Holdings, bought 61% of Alpha Diaries two years ago from the late Ace Riyaz Kurji but shut down its milk processing factory in Uganda and put up its equipment for sale last August.
Kabu auctioneers were hired in May 2009 to auction the sale of the company and recover debts owed to DFCU Bank.
Shumuk emerged the highest bidder in the deal with a $1.2m offer.
Diariboard’s investment in Alpha Dairies hit a snag following its inability to secure capital.
Its $6m (sh1.2b) investment was never profitable since its establishment in 2007, forcing it to close last year.
The company supplied dairy products to Burundi, the Democratic Republic of Congo, Kenya, Rwanda and Sudan.
Sources said Diariboard expanded too fastwhen it made an ill-funded acquisition in Uganda to escape price controls and deteriorating business in Zimbabwe.