Coca-Cola Mexico to acquire Coca-Cola Phl

MANILA, Philippines - Mexico’s Coca-Cola FEMSA, S.A.B. de C.V, the world’s largest bottler, is acquiring a 51-percent stake in Coca Cola Bottlers Philippines Inc. (CCBPI) for $688.5 million in cash, its first acquisition outside Latin America.

Coca-Cola Femsa, which sells softdrinks in nine Latin American countries, has the option to acquire the remaining 49 percent of CCBPI at any time during the seven years following the closing of the deal.

CCBPI has 23 production plants, serving close to 800,000 customers throughout the country and is expected to sell about 530 million unit cases of beverages this year.

Coca-Cola FEMSA’s purchase is seen as a vote of confidence in the strength of the Philippine economy. Through this transaction, Coca-Cola FEMSA will leverage its strong culture of social development, its proven know-how and operating capabilities in the Philippines’ fast growing non-alcoholic beverage industry and its complex retail landscape.

Coca-Cola FEMSA will be in charge of the day-to-day operations of CCBPI and, together with the Atlanta-based Coca-Cola Co., they expect to enhance the bottling operations and contribute to growth in the Philippines’ market.

“The market in the Philippines represents the expansion of our global footprint beyond Latin America, reinforcing our exposure to fast growing economies. It provides a unique opportunity to operate in a country with healthy growth prospects, dynamic internal consumption and an attractive socio-economic and demographic profile,” said Carlos Salazar Lomelin, chief executive officer of Coca-Cola FEMSA.

Coca Cola FEMSA chairman Jose Antonio Fernandez Carbajal said: “We see profitable growth prospects and long-term returns in emerging market economies. Our principles and values share a common ground with the Filipino community and we are sure that together we can extend FEMSA’s long lasting commitment to the continuous creation of economic, social and environmental value in every community where we operate.”

Atlanta-based Coca Cola chairman and chief executive officer Muhtar Kent, for his part, said the transaction relects the group’s long-standing belief in the global franchise system and continued commitment to innovation and growth in the Philippines.

Coca-Cola has been present in the Philippines since the start of the 20th century and has been locally produced since 1912. The Philippines received the first Coca-Cola bottling and distribution franchise in Asia.

The deal may signal more Asian acquisitions for Coca-Cola FEMSA, a joint venture of Coca-Cola Co. and Mexican retailer and beverage company Femsa, as Latin America offers little room for expansion.

Coca-Cola Femsa has rights to sell drinks such as Coke, Sprite and Fanta in parts of Guatemala, Colombia, Panama, Brazil, Nicaragua, Costa Rica, Venezuela and Argentina.