Coca-Cola HBC, a Swiss-based bottler, announced on Tuesday that it has agreed to pay $2.6 billion to acquire a 75% ownership in its African counterpart. This will make it the second-largest Coca-Cola bottling company in the world by volume.
In a deal valued at $3.4 billion, Coca-Cola HBC will buy the Gutsche Family Investments’ whole investment in Coca-Cola Beverages Africa (CCBA) and the approximately 42% stake held by U.S.-based Coca-Cola.
The deal, in terms of Coca-Cola bottling volumes, places the combined group second after Coca-Cola FEMSA and increases Coca-Cola HBC’s presence in Africa to meet the rising demand in 14 new regions, which younger customers drive for Coca-Cola HBC.
Coca-Cola HBC, which is already listed in London and Athens, announced that it would immediately halt its share buyback program and plans to pursue a secondary listing on the Johannesburg Stock Exchange.
Coca-Cola Chief Operating Officer Henrique Braun stated, “Coca-Cola HBC is a strong and valued bottler that will help usher in the next chapter of growth for CCBA.” About 23% of Coca-Cola HBC is owned by the Atlanta-based company
Founded in 2014, CCBA sells over 40% of all Coca-Cola beverages in Africa, including Monster, Sprite, and Fanta.
According to the agreement, Coca-Cola HBC has six years to purchase the company’s remaining 25% interest in CCBA.
At 0710 GMT, Coca-Cola HBC’s stock was down 4.2% at 3390 pence, which led to losses on the larger FTSE 100 index (FTSE).
As consumer mood remained muted, the business separately announced a 5% increase in third-quarter organic revenue on Tuesday, which was significantly less than its 13.9% gain in the same period last year.
As it hikes pricing, the bottler stated that it still anticipates organic revenue growth in 2025 at the upper half of its 6% to 8% range.
