Coca-Cola, AB InBev reach agreement on Africa business
Coca-Cola looks to refranchise new assets
Atlanta-based The Coca-Cola Co. and Anheuser-Busch InBev (AB InBev), Leuven, Belgium, have reached an agreement regarding the transition of AB InBev's 54.5 percent equity stake in Coca-Cola Beverages Africa (CCBA) for $3.15 billion, after customary adjustments. CCBA includes the countries of South Africa, Namibia, Kenya, Uganda, Tanzania, Ethiopia, Mozambique, Ghana, Mayotte and Comoros.
In addition, the companies have reached an agreement in principle for The Coca-Cola Co. to acquire AB InBev's interest in bottling operations in Zambia, Zimbabwe, Botswana, Swaziland, Lesotho, El Salvador and Honduras for an undisclosed amount.
The transactions are subject to the relevant regulatory and minority approvals and are expected to close by the end of 2017.
The Coca-Cola Co. plans to hold all of these territories temporarily until they can be refranchised to other partners. The Coca-Cola Co.'s intent is to account for the acquired stakes as a discontinued operation for reporting purposes, it says.
Carlos Brito, chief executive officer of AB InBev, said in a statement, "We are happy that we have been able to reach this agreement with The Coca-Cola Co. in a timely manner and with a satisfactory outcome for all parties."
Muhtar Kent, chairman and chief executive officer of The Coca-Cola Co., added: "We are pleased to have reached an agreement quickly that is in everyone's best interests. We will move forward with our long-term strategic plan in these important growth markets. We are continuing negotiations with a number of parties who are highly qualified and interested in these bottling territories and look forward to refranchising these territories as soon as practical following regulatory approval."