Workers strike over Coke selling out to local companies

Workers at Coca-Cola bottling plants in three Chinese cities went on strike after the US soft drinks company announced it was selling its bottling interests in the country to its local partners, media reported on 25 November 2016. Coke workers fear they will lose their jobs or pay under the state-owned employer.

The soft drink company said on 17 November 2016 that it is selling all its bottling assets in mainland China to Hong Kong conglomerate Swire Beverage Holdings and COFCO Corporation, one of China’s state-owned food giants, for about USD 1 billion. This divestment is part of Coke’s broader strategy to focus on its more profitable concentrate-making business.

Coke owns roughly a third of its bottling ventures in China, with the rest split roughly between Swire and China Foods, which is part of state-owned COFCO.

Under the agreement, media say, Swire and China Foods each will own roughly half of Coke’s bottling operations in the Asian country.

China is Coke’s third-largest market by volume behind the US and Mexico. The company and its bottling partners recently opened their 45th plant in the country and are in the midst of a USD 4 billion investment push.

The divestment in China remains subject to regulatory approvals.