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| Summary of Project Information (SPI) |
| This Summary of Project Information is prepared and distributed to the public in advance of the IFC Board of Directors’ consideration of the proposed transaction. Its purpose is to enhance the transparency of IFC’s activities, and this document should not be construed as presuming the outcome of the Board decision. Board dates are estimates only. |
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| Project number | 24213 |
| Project name | BBL |
| Country | Tanzania, United Republic of |
| Sector | Food & Beverages |
| Department | Agribusiness |
| Company name | Bonite Bottlers Limited |
| Environmental category | B |
| Date SPI disclosed | April 12, 2005 |
| Projected board date | May 15, 2005 |
| Status | Active |
| Previous Events | Invested: October 28, 2005
Signed: June 8, 2005
Approved: June 1, 2005 |
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| Description of company and purpose of project |
Bonite Bottlers Limited (BBL or the company) is a beverage bottling and distribution company located in Moshi, Tanzania. BBL holds the franchise to bottle carbonated soft drinks (CSD) for Coca Cola in several regions in northern Tanzania. BBL’s franchise regions include Arusha, Kilimanjaro and Manyara and two districts – Singida and Manyoni – in the Singida region. The Company also bottles mineral water under the Kilimanjaro Drinking Water (KDW) brand.
The project is to assist BBL to expand its production capacity and acquire the latest equipment for its operations. The project involves the following components:
- expanding its CSD production capacity to 36,000 bottle per hour (bph) from the present 24,000 bph on its returnable glass bottle (RGB) line;
- replacing an existing PVC bottling line with a modern PET bottling line;
- extending its factory complex to house the new RGB line and provide additional storage space;
- acquiring additional vehicles to augment its distribution network;
- acquiring a PET-preform manufacturing line and
- providing incremental working capital.
The total project cost is estimated at $20 million.
BBL has not upgraded or replaced any machinery within its operations in the last 10 years. Now is an opportune time for BBL to replace its dated machinery with modern equipment, and increase production efficiency. The Project will enable BBL to produce a larger volume of Coca-Cola products and expand its market share through the supply of a wider range of products. The Project will also change the type of material used from PVC to PET, which is a better packaging material, is less costly and has a more aesthetic presentation. Finally, the ability to manufacture PET-preforms will significantly reduce operational cost for BBL and increase its ability to produce a wider variety of PET packaged products. |
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| Project sponsor and major shareholders of project company |
The project sponsors are IPP Limited and Mr. Reginald Mengi. The Reginald Mengi Family Trust owns 100% of BBL. The Trust controls the IPP group of companies which are involved in media, beverages, mining and minerals, and gemstones prospecting. IPP’s leading products/service brands include The Guardian newspaper, ITV national television station. IPP also has a strategic shareholding in the CRDB Bank and the African Media Group and is a minority shareholder in other Coca-Cola franchises through the following:
- Zanzibar Bottlers;
- Kwanza Bottlers;
- Afri Bottlers; and
- Mtwara Bottlers.
Kwanza bottlers is the largest beverage bottler in Tanzania. |
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| Total project cost and proposed IFC investment |
| The total project cost is estimated at $20 million. The proposed IFC investment is an A-Loan of up to $10 million for IFC’s own account. |
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| Location of project and description of site |
| The expansion project will be located at BBL’s existing production plant located in Shiri Matunda in the Moshi municipality in northern Tanzania. |
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| Project Development Impact and IFC's Role |
Project Development Impact:
Improving Production Efficiency:
The project will upgrade and expand BBL’s production capacity using the latest equipment and technology. BBL will benefit from improved product quality and reduced production cost. This project will indirectly benefit the extensive network of suppliers of goods and services to the company, as well as its distributors.
Employment and Social Benefits:
The project will also have a positive impact on employment. BBL currently employs 450 people on a permanent basis. The project will employ an additional 50 permanent and casual employees, which will have an important knock-on effect on the region’s economy. BBL’s depots supply direct to 26 stockists and wholesalers, and to 9,500 retail outlets. As a result, the Project will further support indirect employment and micro enterprise development, through the forward linkages of distribution and retailing.
IFC’s Role:
IFC’s trust funds will be used to assist the company in strengthening the efficiency of its distribution network and management information systems. IFC’s SME department and BBL are also exploring the possibility of a linkages program to increase private sector participation in the economy. IFC’s involvement in this project will demonstrate confidence in the manufacturing sector, implicitly leading to higher growth and employment creation. Additionally, IFC is providing long-term financing to BBL on terms that are currently not available in Tanzania. |
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| Environmental and social issues - Category B |
This is a Category B project, according to IFC's Environmental and Social Review Procedure because a limited number of specific environmental and social impacts may result which can be avoided or mitigated by adhering to generally recognized performance standards, guidelines or design criteria. The following potential environment, health and safety areas of the project were analyzed: water supply; power supply; fuel storage, handling, recycling and disposal of solid and liquid wastes; worker health and safety; hygiene and housekeeping; CFCs; and fire prevention and emergency response. The plant has in-house wastewater treatment which will be upgraded as part of the project.
To view the environmental documents for this project, click here |
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| Location of environmental documents in locally affected community |
Environmental documents will be made available at the following locations:
- Municipal Office in Moshi
- At BBL’s factory gate in Shiri Matunda, Moshi, Tanzania |
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| To contact the project company, please write to: |
Zoeb Hassuji, Managing Director
Shiri Matunda
PO Box 1352, Moshi |
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