FDBusiness.com

New Soft Drinks Combination in Western Europe to Create World’s Largest Independent Coca-Cola Bottler

 Breaking News
  • UK Shoppers Set to Spend £21.6 Billion on Food and Groceries This Christmas The UK grocery market is set to experience 2.4% growth this Christmas, with shoppers predicted to spend £21.6 billion over the festive period, according to the latest forecast from research organisation IGD. With nearly half (48%) of shoppers agreeing that food and drink is the most important part of Christmas Day, grocery has a key role to [...]...
  • Europastry Broadens its Portfolio Europastry, a family-owned business specialising in frozen bread and patisserie products, has completed its purchase of Confeitaria Torres, a Portuguese bakery company. Based in Trofa near Porto, Confeitaria Torres supplies fresh and deep-frozen bakery and pastry products. With the acquisition, Europastry adds another craft baker to its production capacity, further consolidating its range of high quality [...]...
  • Quality is King in China’s Infant Formula Market Chinese parents care much more about the quality and nutritional value of infant formula than its price, new research by Advanced Lipids has shown. China accounts for almost half of all infant formula sales globally. To gain new market insights, Advanced Lipids, manufacturer of the fat ingredient INFAT®, surveyed 211 urban Chinese parents. All fed their children [...]...
  • Austrian Meat Manufacturers Turn to FlatSkin® System by SEALPAC Food retailers in Austria, like in many other European countries, are increasingly choosing vacuum skin packaging. This technology can be found in a growing number of varieties across the retail shelves, owing to its obvious benefits: securely sealed under deep vacuum, food products have a significantly longer shelf life and can be presented in a [...]...
  • FrieslandCampina Strengthens US Presence Royal FrieslandCampina, the global dairy group, has acquired US-based importer and distributor Jana Foods. The acquisition will further strengthen FrieslandCampina’s position in supplying Dutch specialty cheese to the US market. Jana Foods will be integrated in the FrieslandCampina Consumer Dairy USA business. “This acquisition supports our strategy of investing for growth. This investment is in line [...]...

New Soft Drinks Combination in Western Europe to Create World’s Largest Independent Coca-Cola Bottler

New Soft Drinks Combination in Western Europe to Create World’s Largest Independent Coca-Cola Bottler
August 10
09:21 2015

Coca-Cola Enterprises (CCE), Coca-Cola Iberian Partners (CCIP) and Coca-Cola Erfrischungsgetränke (CCEAG), a wholly owned subsidiary of The Coca-Cola Company, have agreed to combine their businesses into a new company to be called Coca-Cola European Partners, in a transformational deal that will create the world’s largest independent Coca-Cola bottler based on net revenues. With more than 50 bottling plants and approximately 27,000 associates, Coca-Cola European Partners will serve a consumer population of over 300 million in 13 countries across Western Europe, including Andorra, Belgium, France, Germany, Great Britain, Iceland, Luxembourg, Monaco, Norway, Portugal, Spain, Sweden and the Netherlands. The combined company will operate in the four largest markets for nonalcoholic ready-to-drink beverages in Western Europe – Germany, Spain, Great Britain and France.

On a pre-synergy, pro forma basis, for 2015 the combined company’s annual net revenues are expected to be approximately $12.6 billion with $2.1 billion of EBITDA and $1.6 billion of operating income with a volume of 2.5 billion unit cases. Coca-Cola European Partners’ effective tax rate is expected to be in a range of 26 to 28%.

Coca-Cola European Partners will be incorporated in the United Kingdom, one of its largest markets, with its headquarters in London. The combined company will be publicly traded with listings on the EuronextAmsterdam, the New York Stock Exchange and the Madrid Stock Exchange.

CocaColaGBCokeCansMasterbrandOnce combined, Coca-Cola European Partners will leverage and build on the best practices from each respective market and bottler to improve service to customers and consumers through a more consistent strategy for product development and market execution across Western Europe. The increased scale and flexibility of Coca-Cola European Partners’ broader European geographic footprint will allow it to compete more effectively across nonalcoholic beverage categories.

Coca-Cola European Partners is expected to generate substantial synergies, including supply chain benefits and operating efficiencies. These synergies are expected to result in realized annual run-rate pre-tax savings of approximately $350-375 million within three years of closing. The new company’s synergies will also position it for increased investment in sales and customer-facing activities to drive incremental top-line and profit growth over the long term.

Coca-Cola European Partners will combine the unique market knowledge of CCE, CCIP and CCEAG, enabling increased coordination and innovation to better serve customers and consumers at a local level in each market. As a larger and more diverse company, Coca-Cola European Partners will continue to invest, employ, manufacture and distribute locally, maintaining a strong commitment to the economic and social well-being of each community it serves.

Coca-Cola Enterprises’ shareowners will own 48%, Coca-Cola Iberian Partners’ shareowners will own 34% and The Coca-Cola Company will own 18% of Coca-Cola European Partners’ shares on a fully diluted basis

CocaColaEnterprisesWakefieldProductionLineCompressed“The creation of a larger, unified Coca-Cola bottling partner in Western Europe represents an important step in our global system’s evolution,” says Muhtar Kent, Chairman and Chief Executive Officer of The Coca-Cola Company. “We continue to adapt our business model to innovate, invest and grow along with the changing demands of the marketplace. With the strong leadership that will be assembled from across the three organizations, Coca-Cola European Partners will be well-positioned to deliver better and more effective service to customers throughout Western Europe and drive profitable growth across multiple beverage categories.”

Sol Daurella, Executive Chairwoman of Coca-Cola Iberian Partners, adds: “In 2013, we combined our family-owned Iberian Coca-Cola bottlers with over 60 years of history to better serve our customers and consumers. Our Iberian shareowners see today’s announcement as an important step to further develop and optimize our offerings in Western Europe. As the single-largest shareowner in this new business we will play a strong strategic role in Coca-Cola European Partners, while continuing to be close to our country, business, local consumers and customers. Combining our unique expertise in the on-premise channels, targeted marketing experience and operational excellence with the skills of CCE and CCEAG, together we will drive growth in Western Europe.”

“The creation of Coca-Cola European Partners will build on each bottler’s capabilities to create more efficient operations in their respective markets across Western Europe,” comments John Brock, Chairman and Chief Executive Officer of Coca-Cola Enterprises. “We look forward to bringing together our world-class supply chain and sales team with the distinct strengths offered by CCIP and CCEAG to capture additional growth opportunities in each market. This transaction offers clear synergies, along with the scale to better serve the needs of our customers and consumers in Western Europe, to become an even stronger partner to The Coca-Cola Company and create increased value for CCE’s shareowners.”

CocaColaLifestyleSol Daurella will become Chairwoman of Coca-Cola European Partners and John Brock will become Chief Executive Officer. Both will be members of the Board of Directors.

Damian Gammell, currently Beverage Group President and CEO of Anadolu Efes and a previous Chief Executive Officer of CCEAG, will join CCE as Chief Operating Officer in autumn 2015 and become Chief Operating Officer of Coca-Cola European Partners upon closing. Manik (“Nik”) Jhangiani, currently the Chief Financial Officer of CCE, will become Coca-Cola European Partners’ Chief Financial Officer and Víctor Rufart, currently General Manager of CCIP, will become Chief Integration Officer. Other members of the new executive team will be announced before the closing of the transaction.

The combined company is expected to have a 2015 pro forma net debt to EBITDA ratio of approximately 3.5x, and given anticipated cash flows, is expected to de-lever to approximately 2.5x by year-end 2017. Coca-Cola European Partners is fully committed to an investment-grade rating and intends to operate within a 2.5x-3.0x net debt to EBITDA ratio longer term. It intends to distribute dividends per share in the range of approximately 30 to 40% of net income over time, to be determined by its Board of Directors.

CAPTION:

Muhtar Kent, Chairman and Chief Executive Officer of The Coca-Cola Company; Sol Daurella, Executive Chairwoman of Coca-Cola Iberian Partners; and John Brock, Chairman and Chief Executive Officer of Coca-Cola Enterprises, toast the creation of Coca-Cola European Partners.

About Author

mike

mike

Related Articles



Food & Drink Business Conference & Exhibition 2016

Upcoming Events

  • June 18, 2019Multimodal 2019
AEC v1.0.4

find food jobs

The Magazine

F&D Business Preferred Suppliers

New Subscriber





Subscribe Here



Advertisements