26th Oct 2020 09:50
(Alliance News) - Coca-Cola European Partners PLC on Monday said it has made a non-binding offer to acquire Coca-Cola Amatil Ltd from investors and US brand owner Coca-Cola Co to extend its consumer reach and create a broader and more balanced company footprint.
The Uxbridge, Middlesex-based soft-drinks bottler said it plans to acquire 69% of Sydney-based Coca-Cola Amatil from investors, as well as the remaining 31% from Coca-Cola Co, for a total value of AUD8.7 billion.
Coca-Cola Amatil is a bottler and distributor of ready-to-drink non-alcoholic and alcoholic beverages and coffee in the Asia Pacific region, operating in Australia, New Zealand, Indonesia, Papua New Guinea and Fiji. It posted earnings before interest, tax, depreciation and amortisation of AUD1.0 billion in 2019 on revenue of AUD5.1 billion.
The acquisition would create a broader and more balanced footprint for the Coca-Cola European Partners whilst almost doubling its consumer reach, with the aim of ultimately driving sustainable and faster growth, through geographic diversification and scale, Coca-Cola European Partners said.
Gammell said: "This is a unique and tremendous opportunity to combine two of the world's best bottlers, creating a broader and more balanced geographic footprint, including one of the most attractive and populous emerging markets, doubling our consumer reach to 600 million.
Coca-Cola European Partners operates in the UK, France, Germany, Spain and Portugal, the Benelux region, and Sweden and Norway.
"This larger platform would enable us to scale up even faster than before and solidify our position as the largest Coca-Cola bottler by revenue, further strengthening our strategic partnership with The Coca-Cola Co."
Coca-Cola Co has a 19% stake in Coca-Cola European Partners.
Rothschild & Co is acting as lead financial adviser for Coca-Cola European Partners.
Coca-Cola European Partners also said Monday its revenue for the third quarter ended September 25 was down 3.0% to EUR3.8 billion from EUR3.28 billion a year prior.
Volume was down 4% to 665 million cases from 691 million cases a year before.
Revenue per unit case was up 1.0% to EUR4.80 each from EUR4.77 a year prior.
Chief Executive Damian Gammell said: "Our performance over the summer months was encouraging. Volumes significantly improved compared to the second-quarter of the year, mirroring outlet re-openings in the away from home channel, solid demand in the home channel, where we continued to take share, as well as favourable weather across most markets. While the reintroduction of restrictions and local lockdowns has resulted in continued uncertainty about the duration and impact of the pandemic, we continue to believe that the second quarter will be the most impacted."
The company declared an interim dividend of EUR0.85 per share, up from EUR0.65 a year prior, maintaining its annualised dividend payout ratio of 50%.
"We continue to demonstrate the resilience of our business and our ability to operate with agility in such a rapidly changing environment. I am proud of how our colleagues have continued to support our customers, consumers and communities," Gammel said.
Coca-Cola European Partners shares were up 8.5% at EUR35.25 each in London on Monday morning. Coca-Cola Amatil shares closed up 16% at AUD12.50 on Monday in Sydney. The stock was trading flat in 2020 so far before the announcement.
By Greg Roxburgh; [email protected]
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