Nestle Waters gets into Algerian partnership

12/05/05 Nestlé Waters has announced the creation of a partnership with the Zahaf brothers, owners of the Boissons Gazeuses des Frères Zahaf Group (B.G.F.Z. - formerly Boissons Sidi El Kebir), one of the leading players in the beverage field in Algeria.

Nestlé Waters and the Zahaf Brothers are now associates in a joint stock company called Société Source de TABERKACHENT, with Nestlé Waters holding 51% of the capital. This corporation has taken over all of the B.G.F.Z. group's bottled water business, the Sidi El Kebir water brand and has a distribution agreement that will enable it to take advantage of the network and expertise developed in Algeria by the B.G.F.Z. group. The company will be headed by Mohamed ZAHAF.

At 550 million litres, for an annual bottled water consumption per inhabitant of more than 16 litres at the end of 2004, the bottled water market in Algeria displays a strong growth potential, with annual growth in consumption at more than 22% in recent years.

Algeria will play an important role in Nestlé Waters' development strategy for the Africa/Middle East region. Located in the heart of the Maghreb countries, with 34 million inhabitants and perspectives for double-figure growth in annual consumption per inhabitant, it represents a veritable growth booster which should enable Nestlé Waters to develop its positions in North Africa. The partnership thus formed has set a strong growth objective for itself.

This positioning is part of Nestlé Waters' strategy, according to the Chairman, Mr Carlo DONATI : "In addition to our 2 pillars, Europe and North America, we hope to continue to take advantage of every opportunity to consolidate our position in other regions of the world without lowering our performance. North Africa offers real development opportunities for our brands."

For the Chairman of the B.G.F.Z. group, Mr ZAHAF, "This partnership should enable the B.G.F.Z. group to obtain the development resources it needs to consolidate its activities in the bottled water sector throughout Algeria. It is also an opportunity for the group to gain access to the expertise of the global leader in bottled water, so as to be able to offer Algerian consumers a larger line of products. In conclusion, this partnership with Nestlé Waters will give us access to other brands to consolidate the attractiveness of our product mix throughout the country."

The B.G.F.Z. group was founded in the early 1980s by the ZAHAF family. It is specialised in the production and distribution of bottled waters and carbonated beverages. Since the start of the decade, it has been the exclusive Algerian bottler and distributor of the Orangina and Mecca Cola brands. In 2001, the B.G.F.Z. Group added the natural still mineral water brand Sidi El Kebir to its business portfolio.

At the end of 2004, this brand was in second position on the fledgling bottled water market in Algeria, with a substantial market share. Sidi El Kebir water comes from a spring near the town of Blida, 50 kilometres from Algiers.