Coca-Cola Hellenic Bottling Company (CCH), one of the largest bottlers in the Coca-Cola system, has reached a $3.4bn deal to acquire a 75% stake in Coca-Cola Beverages Africa (CCBA), marking a significant shift in Coca-Cola’s long-standing approach to its bottling operations. The deal, which sees CCH acquire 41.5% of CCBA from Coca-Cola and 33.5% from Gutsche Family Investments, is part of the Atlanta-based company’s broader strategy to move toward a more asset-light business model by selling off its bottling operations.
The acquisition elevates Coca-Cola Hellenic to the position of the second-largest bottler in the global Coca-Cola system, following a trend over the last decade where Coca-Cola has progressively divested its bottling operations. Coca-Cola HBC’s CEO, Zoran Bogdanović, expressed the company’s intention to eventually acquire CCBA in its entirety, citing the significant growth potential in Africa due to its expanding consumer base and increasing demand for Coca-Cola products.
For Coca-Cola, this sale represents its exit from its last major bottling asset, a step that further solidifies the company’s transition into a model where it focuses on marketing and selling syrups to regional bottlers. Coca-Cola has increasingly relied on its bottling partners to produce and distribute its beverages, with regional bottlers like Coca-Cola Europacific Partners in Europe and Arca Continental in Latin America now controlling much of the company’s production and distribution network.
The deal also creates a pan-African bottler, with CCBA operating in 14 African markets, including major economies like South Africa and Uganda. This acquisition brings Coca-Cola HBC’s operations to a total of 29 countries across Europe and Africa, including key markets such as Greece, Italy, Russia, Egypt, and Nigeria. CCBA is responsible for bottling and distributing approximately 40% of Coca-Cola’s products across Africa, making it a crucial part of the company’s overall supply chain in the region.
The deal, which has been hailed as a strategic move to tap into Africa’s growing markets, comes as Coca-Cola looks to exit its remaining bottling assets. A person involved in the transaction mentioned that Coca-Cola had considered listing its bottling business but ultimately decided against it due to insufficient investor interest.
Despite the optimistic outlook for the deal and the broader African market, Coca-Cola HBC’s shares fell by 4% on the London Stock Exchange on the day the transaction was announced. This minor setback reflects the inherent uncertainties in large-scale acquisitions, particularly in fast-growing but complex markets like Africa.
