If you enjoy a tipple in Nairobi every now and then, especially East African Breweries Limited (EABL) brands such as Tusker, chances are your drink has been distributed to your favorite watering hole by Bia Tosha, the alcohol distributor owned by Peter Burugu, a tycoon with interests in the alcohol and real estate sectors. He is also the owner of Kiambu Mall.
Bia Tosha has since 2016 been locked in a legal battle with EABL to retain control of its lucrative distribution routes across Nairobi. The Supreme Court in February ordered EABL to reinstate Bia Tosha on the contested routes in Nairobi, Machakos and Kajiado.
At one point, Bia Tosha was reportedly handling 12 out of every 100 cases of EABL products. Peter Burugu spent 27 years working for EABL before exiting the company in an early retirement plan, in April 1995. Armed with an insider’s understanding of EABL and the alcohol business in Kenya, he proceeded to venture into business as a distributor.
Burugu saw an opportunity at the time as the ‘Beer Wars’ pitting EABL against South African Breweries (SAB) were brewing. The late politician Njenga Karume was at the time EABL’s top distributor, but ditched the company to become a distributor for SAB which owned the Castle Lager brand.
Burugu registered a new company under the name ‘Bia Yetu’ and was offered the opportunity to replace Karume’s firm as a distributor in Kiambu and parts of Nairobi including Dandora and Kariobangi. He secured financing from a local bank enabling him to buy nine trucks, while EABL reportedly supplied him stock on credit for the first year.
As the business grew, Burugu secured control of new lucrative routes in Nairobi, particularly after EABL’s main distributor for Nairobi West went out of business. Burugu registered a second firm known as Bia Tosha, and took control of the Nairobi West territory.
He merged his two companies in 2008 and relinquished control of the Kiambu routes to a different distributor, as part of an agreement with EABL. Bia Tosha routes now included South C, Industrial Area, Hurlingham, Upperhill, Kiserian, Rongai, Namanga and Juja.
Anne-Marie Burugu took charge of the company in 2011, taking over from her father, and has steered it since.
In the current legal battle, Burugu wants Bia Tosha to be compensated to the tune of Ksh1 billion for losses incurred by the distributor in the past seven years. The legal battle was initiated in 2016 after Bia Tosha accused Kenya Breweries Ltd (KBL) of terminating a distributorship contract entered between them in 2006.
Bia Tosha initially supplied EABL products in 14 areas before the routes were increased to include 22 larger areas including Athi River, Kitengela and Kawangware. EABL would then repossess routes including Baba Dogo, Dandora and Karobangi North, for Bia Tosha to concentrate on the larger routes. Bia Tosha requested a refund of the goodwill they paid but KBL rejected the demand stating the amount was non-refundable, sparking the court battle.