Coca-Cola is considering options for $6 Billion Africa bottling unit
The Coca-Cola Company is reportedly considering options for its bottling business in Africa, including a sale or initial public offering. In 2020, Coca-Cola had disclosed plans to restructure its business and slim down its portfolio.
The Coca-Cola Beverages Africa business which serves 13 countries in sub-Saharan Africa including South Africa, Ghana, Kenya, Ethiopia, including Kenya, Ethiopia and Ghana, accounts for about 40% of The Coca-Cola Company’s drinks sold on the continent. Coca-Cola concluded a deal earlier this year to increase local shareholding in its South Africa bottling unit.
According to Bloomberg, deliberations are ongoing and there is no certainty that this will lead to a sale or IPO. The soft drinks giant holds 66.5% of Coca-Cola Beverages Africa and is speaking with potential advisers about its exit options. A sale or IPO of the stake could value the African business at about $6 billion which is subject to change depending on the level of buyer interest.
Coca-Cola initially tried to offload the stake after it pulled interest from the likes of Heineken NV and Coca-Cola HBC AG in 2017. It had acquired the majority holding less than a year earlier, when it paid $3.15 billion to buy Anheuser-Busch InBev out of the African bottling joint venture.
The U.S. beverage giant had wanted to refranchise the unit as part of its global plan to divest its manufacturing and distribution assets to focus on main beverage business and boost margins. In 2019, the Coca-Cola Company announced that it would no longer refranchise its Africa bottling business, Coca-Cola Beverages Africa, CCBA, and would instead keep its majority stake in the unit for the time being. At the time, Coca-Cola HBC and rival Coca-Cola European Partners were seen as potential buyers for the unit.
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