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Coca-Cola Europacific Partners seeks $1.8bn purchase of Coca-Cola Beverages Philippines

02-Aug-2023 - Last updated on 02-Aug-2023 at 14:31 GMT

Coca-Cola Europacific Partners would become the largest bottler of the soft drink in the world if the deal goes through

Coca-Cola Europacific Partners (CCEP) has signalled its intent to acquire Coca-Cola Beverages Philippines (CCBPI) in a deal worth $1.8bn.

CCEP, along with Philippines-based partner Aboitiz Equity Ventures (AEV), is looking to purchase CCBPI from the Coca-Cola Company, a move that would make it the largest bottler of the soft drink in the world.

The partners have entered a letter of intent with Coke, which indicates their preference to complete the 100% acquisition of CCBPI. CCEP and AEV have also agreed to 60:40 ownership split.

Any deal would be subject to regulatory approval, with CCEP stating that if an agreement is reached it would likely happen towards the end of 2023. The move comes not long after CCEP expanded into Australia, Pacific and Indonesia in 2021.

CCBPI made pre-tax profits of $901m (£705m) in 2022 and was described as a “well-run business with attractive profitability” by CCEP chief executive Damian Gammell.

“This would be a natural next step for CCEP, creating a more diverse footprint within our existing API business segment, support Indonesia’s transformation journey and underpin our strategic mid-term objectives,” Gammell added.

CCEP profits on the rise

The acquisition news came alongside the announcement of CCEP’s financial results for the first half of 2023.

Across this period, the group reported an 8.5% year-on-year increase in revenue and an 11% year-on-year increase in comparable operating profit.

Comparable operating profit in Europe grew by 12% year-on-year, while it was up 6.5% in Australia, Pacific and Indonesia compared to the first half of 2022.

“We are also very pleased to have delivered a great first half, achieving strong top and bottom-line growth and generating impressive free cash flow,” Gammell said.

“Our performance reflects great in-market execution, strong customer relationships allowing our consumers to continue to enjoy our portfolio of leading brands across a broad pack offering. This resulted in solid volume growth across our developed markets, whilst our volume in Indonesia reflected the execution of our long-term transformation strategy. Our focus on revenue and margin growth management, along with our price and promotion strategy, drove solid gains in revenue per unit case with transactions outpacing volume.”

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