Coca-Cola Strikes Deal with Mexico’s Arca Continental to Distribute Coke in Texas and Oklahoma
27 May 2016 --- Coca-Cola has taken a further step in moving the manufacturing and distribution of its sodas to its franchise partners by striking a deal with its Mexican bottling partner.
The soft drinks giant said it is transferring the manufacturing and distribution of its products in Texas and parts of Oklahoma to a joint venture led by Arca Continental SAB, one of its biggest bottlers in Latin America.
The move comes as Coke looks to focus primarily on marketing and selling of its portfolio of its drinks and divest the manufacturing and distribution to partners.
It has earmarked the end of 2017 as the date to complete the divestment.
Coca-Cola will own 20% stake in the JV, which Arca will fold its existing drinks businesses in Mexico and Peru into.
Another of Coca-Cola's bottlers, Coca-Cola Bottling Company Limited, based in Alabama, will also have a stake in the JV.
“These are important agreements that will bring a valued, new partner into the U.S. Coca-Cola system,” said J. Alexander “Sandy” Douglas Jr., president, Coca-Cola North America.
“Arca Continental is a strong Coca-Cola bottler that has done a great job developing and sharing best practices in its long-standing history. Arca Continental will be a tremendous partner with United in serving a major region of the United States, and the companies will benefit from having contiguous borders for their territories.
“The Coca-Cola Company is also pleased to gain an additional equity stake in an international bottler that is vital to our long-term success. These initial agreements with The Coca-Cola Company and Coca-Cola Bottling Company United, recognized by its outstanding performance in the U.S. market, strengthen.”
Manuel L. Barragan Morales, chairman of the Board of Arca Continental, said: “Arca Continental's commitment to create value in the sustainable and profitable way that has distinguished us throughout our history.”
“Led by proven leadership from across our organizations, together we will be well-positioned to further enhance service to the customers and consumers in a region of great importance for the Coca-Cola system, while driving profitable growth in multiple beverage categories.”
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