East African Breweries (EABL) will begin producing Captain Morgan Rum as part of its plans of investing in the spirits business in response to rising demand.
The company said it has invested Sh1.4 billion in the spirits division. The investment will fund a distillery that will produce 20,000 bottles per hour, increasing its production two-fold.
Captain Morgan Gold, EABL’s domestic version will retail at Sh800-900 for a750ml bottle, which is half the price of imported bottles. The company said production will begin within the next month.
“The liquid is loved. What we are doing is to make sure we democratise it to make it more widely accessible,” said Andrew Kilonzo, EABL’s head of premium spirits sales.
Kilonzo also said the company will be locally producing other Diageo international spirits although he did not specify which brands.
EABL’s spirits sales in Kenya increased by 20 percent last year, indicating a shift from the commonly preferred Tusker beer.
“We have more and more people interested in whisky as a category and we also have more and more affluence,” said Anne Joy Michira-Muhoro, EABL’s head of spirits.
EABL hopes that the investment in spirits will increase its earnings which have recently remained stagnant or grown by small margins.
In recent years, the spirits market in Kenya performed better than that of Nigeria, South Africa, and Angola. Additionally, Kenya is the fastest-growing market for Johnnie Walker whiskies while the sale of other spirits such as Chrome Vodka increasing by over 20 percent a year.
EABL will be facing stiff competition from Pernod Ricard which imports Jameson Whisky and Africa Spirits. EABL predicts the spirits will contribute half of its annual revenue within the next five years.
According to Daniel Mettyear, an analyst at IWSR in London, the demand for spirits in Kenya is partly propelled by the growing middle-class. “People can afford to show their economic progress through what they are drinking,” he said.