Staff Writer 
DRINKS maker Varun Beverages (Varun) has emerged as the frontrunner for a controlling stake in Dairibord Holdings Limited (Dairibord), as it seeks to close the gap on Asian competitor Export Trading Group (ETG)’s recent acquisition of Dendairy (Private) Limited.
While company chief executive Vijay Kumar Bahl was not readily available for comment as he was travelling, at least four sources familiar with the development – where Equivest Asset Management, Mega Market and Mutare Mart & Exchange are disposing off their 51 percent shares – say the pepsi maker is lining up an US$80 million bid.
“If the reports about Varun are confirmed, I think the real opportunity is to improve capital allocation and operational execution, as it has experience running beverage businesses at scale. And so, this deal could actually bring manufacturing efficiencies… and faster product innovation,” said Emergent Securities financial analyst Sylvester Mupanduki, adding the merger “would not only benefit Dairibord, but raise competition across Zimbabwe’s dairy and beverages sector”.
“In the long term, this could also be positive in creating more value by amplifying growth from the 2009 to 2017 revenue increases of US$43 million to US$103 million, and to volumes of 95 million litres (of milk). The business has continued to grow… with revenue rising from US$126,8 million in 2024 to US$137 million in 2025 and volumes increasing from 118 million to 132 million litres, but return on capital was still under four percent..,” he said.
With Dairibord formerly operating as a farmer-cooperative owned entity before its 90s – commercialisation and – privatisation as well as commanding a 39 percent share of the market, some analysts have dangled “an almost similar model and where the Zimbabwe Stock Exchange (ZSE)-listed firm could be acquired by a consortium made up of the country’s top milk producers, with the support of local developmental institutions or pension funds”.
This, they said, was not only key in protecting an industry – operating in extremely peculiar circumstances of high costs and other unpredictable variables – from a set of investors, who “might introduce a whole new set of value chain dynamics”, but preserve farmers’ interests.
“While Dairibord remains the largest milk processor, the arrival of a deep pocketed shareholder will allow it to consolidate its position in the market (through) technological and operational improvements as well as focus on exports,” another investment analyst Wafa Kuchera said, adding the Mercy Ndoro-led institution not only fitted in well with Varun’s vision, but it would help diversify its product offering and create further access to ‘affordable, mass market drinks or beverages’.
“Dairibord is a strategic investment (with) some of the most iconic and staple brands, thus it aligns nicely and easily with the (supposed) buyer,” he said.
In the meantime, the stake under Bahl’s target and radar belong to Mutare-based businessman Shiraan Muhammad – a multi-invested trader, and entrepreneur who even had shares in Turnall Holdings Limited, among other ZSE stocks.
With Varun having unveiled a pipeline of ambitious projects, including snacks and beer production, in recent years, this new line of business and product range ties in well with its goals to compete fully with the likes of Delta Corporation and Innscor Africa Limited, which offers a variety of drinks and cordials via a variety of subsidiaries including Prodairy and Rutanhi.
The company, meanwhile, not only faces stiff competition from the above-mentioned players, but fellow Indian-owned competitor ETG – which is extensively involved in the cooking oil, rice and soap making industry – has morphed into a fully integrated fast-moving-consumer-goods company, with its March acquisition of Dendairy through Vamara Group. Interestingly, the Kwekwe-based milk producer was at some point an acquisition target of Dairibord’s.
On the other hand, the on-going discussions and developments come at a time Zambian-based TradeKings is reportedly keen on expanding its footprint and presence in Zimbabwe through Big Tree Beverages, and its range of products.
Last week, the Financial Gazette reported that Dairibord’s shares were stable even days upon the foreseen shareholder changes.
