East African Breweries plans to borrow cash to finance a new 15 billion shillings brewery in Kisumu.
The listed brewer says the cash would be sourced from both local and foreign banks.
EABL’s full year net profit rose 6 percent to 8.5 billion shillings helped by reduced operational expenses and increased sales.
The company has proposed seven shillings and 50 cents in dividend payout.
Two weeks ago, President Uhuru Kenyatta presided over the ground-breaking for a new 15 billion shillings state-of-the art brewery that East Africa Breweries Limited is setting up in Kisumu.
President Kenyatta said the investment is in keeping with Jubilee administration’s agenda of creating wealth for all Kenyans by ensuring shared prosperity amongst the citizens.
He said the process is underpinned by the Government’s agenda to empower the private sector to thrive.
“If our private sector does well, that development means that our businesses can invest in new parts of the country, and that they can bring jobs and well-paid jobs at that for our young people, right across Kenya,” said the President.
When complete in the year 2020, the new factory will create more than 1,500 jobs for the locals as well as benefit more than 22,000 sorghum and cassava farmers who will be contracted by EABL.
On Friday, the brewer said it is exploring various funding options for the new plant in Kisumu.
Over the last one year, EABL has invested 5.7 billion shillings in boosting its production capacity, representing a 14 percent increase on what the firm spent the previous year.
The brewer plans to convert a loan advanced to Serengeti Breweries in 2015 into equity, after reaching a settlement with Tanzania’s Fair Competition Authority that had been investigating the transaction.
Reduced operational expenses coupled with a slight increase in sales helped the East African Breweries limited record a 6 percent growth in full year net profit to 8.5 billion shillings.
The board has recommended a final dividend payout of KES 5.5 per share raising the total payout for the year to KES 7.5 a share.
Reported by Ronald Owili, Edited by Christine Muchira