Following a review of its operations, Coca-Cola Amatil has announced its intention to restructure its Asian business activities through the creation of an Asian Beverage Division (CCA Asia). The new unit  will include the South Korean, Indonesian and Papua New Guinea beverage businesses.

The managing director of the Australian-based soft drink group, Terry Davis, said: "The restructuring of these developing businesses under one division recognises the need to increase management focus and capability in the region, especially in the South Korean business."

Davis said Peter Kelly, formerly operations director for the Australian beverage business, will head up CCA Asia and Reg Randall, South Korean executive director sales, has become acting managing director of CCA Korea replacing David Westall.

Speaking today (10 August) after the release of its first half profits, where the announcement of the new division was made, Davis denied the move was the first step towards a divestment of the Asian businesses.

However, he did add that the future of the struggling South Korean operations would be assessed after the 2006 results period.

Trading in South Korea remained impacted by high levels of household debt and continued low consumer demand for non-alcoholic ready to drink beverages, the company said. Consequently, CCA saw little improvement in first half trading from that experienced in the second half of 2004.

CCA said it has begun its upgrade of sales force capabilities in the country and that the Coca-Cola Company has also materially increased advertising in recent months.

CCA has also launched Minute Maid to strengthen its overall product portfolio in the South Korean market. Juice is the second largest segment by value in the non-alcoholic ready to drink market, behind carbonated soft drinks, with approximately 26% of that market at a wholesale value estimated at A$800m.