Regional manufacturing conglomerate Sameer Africa Limited, which had previously invested heavily in Uganda’s diary industry, is set close its tyre plant in Kenya at the end of this month, citing ‘unfair competition’ and high operational costs.
According to Sameer, manufacturers of the Yana brand tyres, their market segment in Kenya has declined from 62% to 25% over the last 10 years, beginning 2005.
In the last year alone the company reported a loss of Ksh 66 million (approx. Ugshs2.3bn), and it also estimates to fork out Kshs 725 million (Approx. Ugshs22.4bn) in winding up costs that primarily include severance payment for employees, Managing Director Allan Walmsley said.
Sameer is also the distributor of Bridgestone tyres in Uganda and other countries in the region including Rwanda, Tanzania, Kenya and Burundi, and by press time it was not possible to establish how the closure would affect the company’s operations in Uganda.
Sameer kicked off its operations in Uganda in 2007, acquiring the then Diary Corporation from Thailand-based firm, Malee Sampran plc, which had also earlier acquired the corporation from the Uganda government in 2004 at one dollar during the privatization process.
Since then Brookside Diary, a huge investment of Kenyan President Uhuru Kenyatta’s family, has acquired the former Diary Corporation from Sameer.