PEPSI bottler Varun Beverages has emerged as the leading prospective buyer for a controlling stake in Zimbabwe’s largest dairy and food processor, Dairibord Ho...
PEPSI bottler Varun Beverages has emerged as the leading prospective buyer for a controlling stake in Zimbabwe’s largest dairy and food processor, Dairibord Holdings Limited, as negotiations continue between major shareholders and an unnamed third party.
The development follows a cautionary statement issued by the Dairibord board, which informed shareholders that three major blockholders Equivest Asset Management, Mega Market and Mutare Mart & Exchange had entered into negotiations to sell their combined shareholding.
The three shareholders collectively control more than 51 percent of Dairibord’s issued ordinary shares. If the transaction is completed, it would result in a change of control at the company.
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Mega Market is currently the largest shareholder in Dairibord, holding a 23,92 percent stake. Stanbic Nominees follows closely with a 23,87 percent shareholding, making it the second-largest shareholder in the company.
Other major shareholders include Serrapin Investments, which holds 12,04 percent, and Old Mutual Life Assurance Company Zimbabwe Limited, which owns a 10,65 percent stake. The Mining Industry Pension Fund completes the top five shareholders with a 4,93 percent holding.
Together, Dairibord’s five largest shareholders control 75,41 percent of the company’s total shares. The remaining 24,59 percent is held by smaller retail and minority investors.
Although the official cautionary statement did not reveal the identity of the potential buyer, market sources have indicated that Varun Beverages is currently the leading contender to acquire the controlling stake.
“A few potential buyers are being mentioned, but Varun Beverages has come out as the leading contender,” said a source familiar with the developments. The source spoke on condition of anonymity because they were not authorised to speak to the media.
Market sources also indicated that Varun Beverages has been quietly purchasing smaller parcels of shares from open-market holders as it positions itself for a possible acquisition.
Another source said that while Varun had reportedly expressed interest in obtaining a controlling stake, no formal communication had been made with Dairibord management.
The source added that the stake currently available to Varun remained below the 51 percent threshold required for control, and that the company had been acquiring additional shares from the open market.
However, another source said Varun Beverages was not the only company interested in acquiring control of Dairibord.
“There are also other players being mentioned,” said the source, indicating that competition may exist among potential buyers seeking a controlling position in the company.
Varun Beverages is an Indian-headquartered multinational company and one of the largest franchise bottlers of PepsiCo products outside the United States.
The company manufactures, bottles and distributes a wide range of beverage products, including Pepsi, Mirinda, Mountain Dew, 7Up and Aquafina.
Varun entered the Zimbabwean market in 2018 when it launched a state-of-the-art greenfield bottling plant in Harare.
Since establishing operations in Zimbabwe, the company has expanded its presence in the local beverage market through low-cost pricing strategies, increased production capacity and a broad retail distribution network.
The company has also moved beyond beverages into the food and snacks sector after securing a licence to manufacture and distribute PepsiCo snack brands, including Simba Munchiez.
The potential acquisition of a controlling stake in Dairibord would bring together two major companies operating in Zimbabwe’s food and beverage sector. However, the transaction remains subject to the ongoing negotiations between the shareholders and the unnamed prospective buyer.
Dairibord is Zimbabwe’s largest dairy and food processor, while Varun Beverages has established itself as a major player in beverage manufacturing and distribution since entering the Zimbabwean market.
The outcome of the negotiations will determine whether Varun Beverages becomes the new controlling shareholder of Dairibord Holdings Limited or whether another interested party secures the stake currently held by the major shareholders.
