Coke opens Sh700m city base

When soft drink giant Coca Cola unveils its Sh700 million office complex in Nairobi today, it will be evidence of the Atlanta-based transnational’s continuing thirst for more business in the region.

President Kibaki is expected to preside at the launch of the building, one of the latest additions to Upperhill’s changing skyline.

“Kenya is a gateway to East Africa. We chose Kenya because of its current and future economic growth potential. It has human capital strength. The communication infrastructure is continually improving. This also happens to be one of our priority markets,” said Nathan Kalumbu, president of Coke’s operation in East and Central Africa.

The Nairobi office, a two-storey affair with room for a further two floors, is a regional base that is expected to serve the firm’s operations in at least 27 countries in East and Central Africa. Hitherto, it has been operating from three rented locations within the city.

“By coming together, we have an opportunity to strengthen and improve our ways of working. We believe that we are building strong relationships within the workplace that are critical to our continued success,” argued Mr Kalumbu.

In Kenya, the Coca Cola system consists of six bottling plants. The oldest is Mombasa-based Coastal Bottlers, which started operations way back in 1948 and is owned by the family of Navin and Suresh Shah.

Local investors

The Shahs also own Kisumu’s Equator Bottlers. Others are Nairobi, Rift Valley (Eldoret), Mount Kenya (Nyeri) and Kisii Bottlers.

In the early 2000, the local franchise went through a cataclysmic consolidation that saw South African transnational Sabco take a major stake in Nairobi Bottlers.

As part of its then “anchor bottler” policy, Sabco (in which Coca Cola retains significant shareholding) got a foothold into Kenya, while some two plants were closed (Nakuru’s Flamingo and Machakos’ Mount Kenya Bottlers) and consolidated under the Nairobi plant.

The move invited strong nationalistic posturing with the feeling that it would scuttle small local investors in the franchise.

Even then, a strong local component remains in the shareholding of three of the other bottlers, largely thanks to investment firm Centum and parastatals ICDC and IDB.