Switzerland-based bottler Coca-Cola HBC on Tuesday said it has agreed to buy a 75 per cent stake in its African counterpart for $2.6 billion.
The deal will create the world’s second-largest Coca-Cola bottling partner by beverage volume.
Coca-Cola HBC’s emerging markets portfolio, comprising some African, Eastern European and Balkan countries, leads its volumes and sales.
Coca-Cola HBC will acquire the US-based Coca-Cola’s roughly 42 per cent stake in Coca-Cola Beverages Africa (CCBA) and the Gutsche Family Investments’ entire stake, valuing the African bottler at $3.4 billion, according to company statements.
Coca-Cola HBC will represent two-thirds of Africa’s total Coca-Cola volume, including drinks such as Fanta, Sprite, and Monster among others.
According to a statement, the acquisition materially expands Coca-Cola HBC’s existing African presence, driving further scale and diversification in high growth markets with compelling long-term demographics, unlocking opportunities for growth.
The company said it also creates a platform to drive growth by leveraging both companies’ expertise in emerging markets as well as enhances shareholder value, with expected low-single digit earnings per share (EPS) accretion from the first full year following completion.
Coca-Cola HBC, which is already listed in two other exchanges intends to pursue a secondary listing on the Johannesburg Stock Exchange.
The completion is expected to be completed by the end of 2026, subject to approvals from relevant authorities.
Speaking on the deal, Coca-Cola Chief Operating Officer, Mr Henrique Braun, which leads the company based in Atlanta and owns about 23 per cent of Coca-Cola HBC said, “Coca-Cola HBC is a strong and valued bottler that will help usher in the next chapter of growth for CCBA.”
The deal for control of CCBA, founded in 2014, will be one of the biggest ever in Africa’s consumer goods space, according to Rothschild, the sole adviser to Coca-Cola.
“We have a deep understanding of the compelling proposition Africa presents. It has a sizable and growing consumer base and there are significant opportunities to increase per capita consumption,” Coca-Cola HBC chief executive, Mr Zoran Bogdanovic said.
Combined, the companies would have generated pro-forma revenues of €14.1 billion and Earnings Before Interest and Taxes (EBIT) of €1.4 billion in 2024.