The French juggernaut Castel, which has returned to the mineral water market in Morocco by launching “Aïn Ifrane” spring water since July 1, 2010, is in the process of getting rid of this activity in the Kingdom. Faced with an increasingly competitive market, Castel wants to focus on its alcoholic beverage activities and launch the production of soft drinks under local brands. In the meantime, buyers are scrambling for the takeover of Aïn Ifrane.
At the end of June 2022, the French juggernaut Castel and the American giant Coca-Cola, announce that the contracts which bind them in ten African countries and according to which Castel bottles and markets the drinks of the American will not be renewed. Suddenly, in these countries where the French group is established, its subsidiaries stop bottling Coke products. Solibra (Côte d’Ivoire), Sobebra (Benin) and Brakina (Burkina Faso) give way respectively to Carré d’Or, Dongaco SA and Coca-Cola Burkina Bottling Company, while SOBOA (Senegal) and SABC (Cameroon) are following. Ditto for Angola and Egypt.
But this end of the partnership of the French brewer with The Coca-Cola Company seems to push the Castel group to review its global positioning on the African continent. Indeed, in parallel with its amicable divorce with the American giant, the French juggernaut will sell its brands of mineral and sparkling water. Thus, no less than 17 water brands are concerned, including Aïn Ifrane in Morocco, Awa, Cristalline, Aquabelle, Marwa, Vitale, EauVive, Safia, Possotomè, Melliti. “We judged that water is not strategic in our activities. And then, this market has become more and more competitive”, justifies Charles de Beistegui, Associate Director of No Com in charge of communication for the “Waters” Division of the Castel group, contacted by Challenge, who underlines that sales will be made gradually and market by market.
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Investment funds and the Bernard Hayot Group in the battle for the takeover of Ain Ifrane
Thus, if the French giant has initiated the process of selling its water brands in Africa, which accounts for 10% of the volume of its turnover, for the moment only its two Moroccan and Ivorian subsidiaries are about to sold, in particular the Société Euro-Africaine des Eaux (also a subsidiary of the Société des Brasseries du Maroc) which operates the water source of Ben Smim “Aïn Ifrane” and Solibra which markets Awa and Cristalline. “For the Aïn Ifrane mineral water activity, Castel is in talks with two potential investors”, indicates Charles de Beistegui who wishes to keep the identity of his two buyers who have already come forward confidential. But according to our sources, the Ain Ifrane brand, faced with just under a dozen local competitors, has registered several expressions of interest, including those of the fund manager IDI Emerging Markets, the Adenia fund based in Mauritius, a another major local investment fund, as well as the Antillean Company Groupe Bernard Hayot (GBH), which operates the Carrefour hypermarkets in Martinique.
As a reminder, it was on July 1, 2010 that the Société des Brasseries du Maroc (SBM) officially launched the marketing of Aïn Ifrane on the national market. It is in Ben Smim, a mountainous region located a few km from Ifrane, that this spring water was born. This activity of SBM, created in 1919, does not date from today. Indeed, the development of the Water division, Sidi Harazem in this case, dates back to 1966 with the acquisition of SBM’s stake in the capital of Sotherma. In 2000, a partnership with Danone for the launch of Ain Saïss mineral water had seen the light of day before the brewery subsidiary of the Castel group returned to the mineral water market by launching Ain Ifrane through its subsidiary: Société Euro- Africaine des Eaux (EAE) which produces from the Aïn Ifrane bottle in a factory with an area of 4,400 m2 also located in Ben Smim.
It should also be remembered that in 2008 already, Castel’s withdrawal from the French mineral water market in France had generated 750 million euros for the sale of its 60% stake in the Alma holding company.
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Verrerie, local brand of soda, the new ambitions of Castel
Today, by separating from its mineral water activity on the continent, the Castel group wants to concentrate on its activities of alcoholic beverages and soda in the wake of the rupture of its partnership with the giant Coke. What about Morocco? “By abandoning its mineral water activity, Castel, which chooses its battles, thus has the desire to favor glass bottles. In Morocco, the group will continue to invest in the brewery and probably launch a glassware unit aimed at export. Ditto for soft drinks for which he intends to launch a local brand as planned also in other African countries. In fact, Castel is going to focus on drinks with glass packaging rather than PET, in order to enhance its glassware”, explains Charles de Beistegui.