What you need to know:
New bottler intended to serve 12 high-growth countries in Southern and Eastern Africa.
Kampala- Rwenzori Mineral Water will soon be bottled by Coca-Cola following an agreement between SABMiller plc and Gutsche Family Investments (GFI, majority shareholders in Coca-Cola Sabco) to combine the bottling operations of their non-alcoholic ready-to-drink beverages businesses in Southern and East Africa.
The new bottler, Coca-Cola Beverages Africa, will serve 12 high-growth countries accounting for approximately 40 per cent of all Coca-Cola beverage volumes in Africa.
Rwenzori MineralWater boasts of about 65 per cent share of the bottled water market in Uganda and the anticipated operational efficiencies of this merger are likely to see the company further strengthen its market leadership position.
“A combined Coca-Cola bottling operation is further evidence of our commitment to Africa, and our firm belief in the tremendous growth prospects that the continent offers,” said Muhtar Kent, chairman and chief executive officer, The Coca-Cola Company.
“As one of the top 10 largest Coca-Cola bottling partners worldwide, Coca-Cola Beverages Africa can leverage the scale, resources, capability and efficiency needed to accelerate Coca-Cola growth and contribute to the economic and social prosperity of African communities.”
“Soft drinks are an important element of our growth strategy. This transaction increases our exposure to the total beverage market in Africa. The opportunity is significant, with favourable demographics and economic development pointing to excellent growth prospects,” said Mr Alan Clark, the SABMiller chief executive.
He added: “This also signifies a strengthening of our strategic relationship with The Coca-Cola Company.”
On full completion of the proposed merger, shareholdings in Coca-Cola Beverages Africa will be SABMiller: 57.0 per cent, Gutsche Family Investments: 31.7 per cent and The Coca-Cola Company: 11.3 per cent.
OPTIMISING AFRICA'S RAPIDLY EVOLVING BEVERAGES MARKET
Africa offers significant growth potential in beverages, underpinned by rising personal disposable income, a fast-growing population and increasing per capita consumption.
With more than 30 bottling plants and over 14,000 employees, Coca-Cola Beverages Africa is poised to be the largest Coca Cola bottler on the continent, with the scale, complementary capabilities and resources to capture and accelerate top-line growth.
Mr Phil Gutsche, the chairman of Gutsche Family Investments (GFI), while commenting about the new merger, said, “Our family sees this merger as an important and logical step to enable Coca-Cola Beverages Africa to optimise the opportunities for development in the rapidly-evolving Africa beverage market. ”