Bottling partner Coca-Cola HBC has reached an agreement with beverage producer The Coca-Cola Company (TCCC) and Gutsche Family Investments (GFI) to buy a 75% stake in Coca-Cola Beverages Africa (CCBA).

The purchase price of $2.6-billion will be settled through a new bridge financing facility to cover a cash consideration, and Coca-Cola HBC shares issued to GFI representing 5.47% of the Coca-Cola HBC group’s enlarged issued share capital.

The companies have also agreed to enter into an option agreement whereby Coca-Cola HBC can buy the remaining 25% equity interest in CCBA still owned by TCCC.

The deal will create the second-largest Coca-Cola bottling partner globally by volume.

Coca-Cola HBC chairperson Anastassis David says the deal marks a historic moment for Coca-Cola HBC. “For decades we have invested to unlock Africa’s extraordinary potential. We look forward to accelerating this positive momentum with CCBA to deliver lasting value for our stakeholders and make a positive impact in the communities we serve,” he adds.

The transaction is expected to be completed by the end of next year, subject to approvals.

Moreover, Coca-Cola HBC intends to pursue a secondary listing on the JSE to underpin its commitment to both South Africa and the African continent.

CCBA operates in 14 African markets, representing 40% of Coca-Cola system volumes sold across the continent.

The acquisition materially expands Coca-Cola HBC’s existing presence on the continent, driving further scale and diversification in high-growth markets with compelling long-term demographics, David explains.

Coca-Cola HBC aims to be a leading beverage partner with a global portfolio of brands to excel in the marketplace.

“Having established our business in Nigeria nearly 75 years ago and, with our successful acquisition and integration of the Egypt business three years ago, we have a deep understanding of the compelling proposition Africa presents.

“It has a sizable and growing consumer base, and there are significant opportunities to increase per capita consumption,” says Coca-Cola HBC CEO Zoran Bogdanovic. 

He notes that the group has bespoke capabilities, commercial expertise and industry-leading approaches to sustainability and communities, which is a winning formula for driving sustainable and profitable growth for all stakeholders.

GFI chairperson Philipp Gutsche, in turn, is confident in Coca-Cola HBC’s ability to take the CCBA business forward. He says the Gutsche family will remain invested in the Coca-Cola system and Africa through its shareholding in Coca-Cola HBC.

Under the terms of the sale and purchase agreement, Coca-Cola HBC will acquire a 41% equity interest in CCBA from European Refreshments Unlimited Company and Coca-Cola Holdings Africa, which are both wholly-owned subsidiaries of TCCC, for $1.3-billion in cash.

A further 33% equity interest in CCBA will be acquired by $308-million cash to GFI and 21-million shares issued – which is equal to $1.3-billion.

Coca-Cola HBC has secured €2.5-billion bridge facilities to cover the cash portions of the acquisition and, if required, to fund the refinancing of some of CCBA’s existing debt.