Coke to buy former SABMiller stake in African bottler

As could be expected, The Coca-Cola Company said on 10 October 2016 that it plans to buy AB-InBev’s stake in Coke's largest African bottler. Coke exercised its right to acquire the bottler under a change-of-control clause.

SABMiller previously held a 54 percent stake in Coca-Cola Beverages Africa (CCBA), which was formed in 2014 when several bottlers combined.

Terms of the buyout will need to be negotiated over the next few months. But analysts have already put a price tag of USD 4 billion to the stake.

Coke will pass the stake on to its existing partners. Among those, analysts consider European-based Coca-Cola European Partners and Coca-Cola Hellenic Bottling or Mexico’s Coca-Cola FEMSA as being among potential partners in Africa.

There has been speculation that AB-InBev might try to acquire Coca-Cola once it has bedded down the SABMiller transaction. This could lead to an interesting exercise in disentanglement. AB-InBev is a bottler for PepsiCo in Latin America, whereas SABMiller’s associates – and now AB-InBev’s – like France’s Castel and Turkey’s Efes are both Coke bottlers in their respective territories.

AB-InBev also holds SABMiller’s interests in Coke bottling businesses in El Salvador and Honduras. Coke said these agreements will be handled later.