Coca-Cola pulls out of Australian bottling in Amatil divestment
26 Oct 2020 --- Coca-Cola has agreed to sell its stake in its Australian bottler, Coca-Cola Amatil, to one of its European affiliates, Coca-Cola European Partners (CCEP). This move comes as the company aims to distance itself from the costly bottling industry.
Coca-Cola Amatil is the authorized bottler and distributor of Coca-Cola’s beverage brands in Australia, New Zealand, Fiji, Indonesia, Papua New Guinea and Samoa.
CCEP offered AU$12.75 (US$9.10) a share for Coca-Cola Amatil, a roughly 23 percent premium on the one-week volume-weighted average price.
However, Coca-Cola agreed to sell its shares in Coca-Cola Amatil at a lower price around the estimate of AU$10 (US$7.3) per share.
COVID-19 restrictions ease
Amatil Group managing director Alison Watkins comments: “It’s pleasing to report that we are seeing earnings momentum return in markets where COVID-19 trading restrictions have eased, including continued recovery in on-the-go channels.”
“This has particularly been the case in Western Australia and New Zealand which have both delivered growth in Q3 of 2020, providing insight on the expected shape of the recovery that can be expected in other markets most notably in other Australian States where restrictions have been slower to ease.”
Formed through the merger of three different operations in 2016, CCEP generated revenue of €12 billion (US$14 billion) in 2019.
CCEP serves markets across Western Europe, including Andorra, Belgium, continental France, Germany, UKGreat Britain, Iceland, Luxembourg, Monaco, the Netherlands, Norway, Portugal, Spain and Sweden.
Coca-Cola divestments
This announcement comes shortly after the beverage giant revealed plans to slim down its portfolio as part of a strategic review earlier this month.
The Coca-Cola Company recently revealed its plans to retire a range of underperforming beverages from its global portfolio by December 31. Among these brands are TaB diet soda and Coca-Cola Life in the US market.
The beverage giant will further direct funds to the launch of promising innovations like Topo Chico Hard Seltzer, Coca-Cola Energy and AHA flavored sparkling water.
Edited by Benjamin Ferrer
