Coke Buys AB InBev’s Stake in African Bottler for $3.15bn
21 Dec 2016 --- Coca-Cola has agreed to buy Anheuser-Busch InBev’s 54.5 percent stake in Coke’s largest African bottler for $3.15bn, the latest in a string of businesses offloaded by AB InBev following the announcement of its $104bn takeover of SABMiller. Coke had revealed in October this year that it planned to exercise its right to buy AB InBev’s stake in Coca-Cola Beverages Africa (CCBA), which distributes around 40 percent of Coke’s volumes in Africa, in light of the brewer’s takeover of SABMiller.
CCBA’s operations span South Africa, Namibia, Kenya, Uganda, Tanzania, Ethiopia, Mozambique, Ghana, Mayotte and Comoros. Coke currently owns around 11 percent of CCBA.
The companies have also reached an agreement for Coke to acquire AB InBev’s interest in bottling operations in Zambia, Zimbabwe, Botswana, Swaziland, Lesotho, El Salvador and Honduras for an undisclosed amount.
Carlos Brito, CEO of AB InBev, said: “We are happy that we have been able to reach this agreement with the Coca-Cola Company in a timely manner and with a satisfactory outcome for all parties.”
“We are pleased to have reached an agreement quickly that is in everyone’s best interests,” said Muhtar Kent, Chairman and CEO of Coke.
“We will move forward with our long-term strategic plan in these important growth markets. We are continuing negotiations with a number of parties who are highly qualified and interested in these bottling territories and look forward to refranchising these territories as soon as practical following regulatory approval.”
The deal is expected to close by the end of 2017. Coke said it plans to hold onto the new businesses until they can be refranchised to its other bottling partners.
Coke, which has been offloading its distribution assets, has previously stated that a number of its bottling partners are interested in acquiring CCBA.
Coke's other bottling partners include Coca-Cola FEMSA in Mexico and Latin America, Coca-Cola HBC AG and Coca-Cola Enterprises in Europe.
One reason for Coke exercising its rights to acquire AB InBev’s stake in CCBA is that it could be concerned about AB InBev’s increased firepower in Africa following its purchase of SABMiller.
AB InBev has offloaded billions of dollars worth of businesses across different continents since it announced its purchase of SABMiller, which has created the world’s biggest beer company. The new group controls nearly one third of the world’s beer.
