AUS: CCA South Korea bottler sale beckons

Coca-Cola Amatil has closed the book on bids for its South Korean bottling business.

The Australia-based Coca-Cola bottler said today (12 April) that it was "pleased" with the potential suitors who have applied for the unit. Earlier this year, CCA enlisted banking giant Goldman Sachs JBWere to help in the "assessment of the best ownership options for the South Korean business, which may or may not result in the divesture of some or all of CCA's South Korean operations".

Since then, a number of companies have thrown their hat into the ring in a bidding war expected to be worth anywhere between A$400m (US$331m) and A$1bn. While Goldman Sachs JBWere estimated that the business is worth between A$400m and A$500m, South Korean media has suggested the price might be driven as high as A$1bn, thanks to the unit's strong retail networks.

Speaking to local press, a Seoul-based spokesperson for the company said: "Today was the deadline for Coca-Cola to receive letters of intent.

"We are pleased with the responses from companies." The spokesperson would not give any further details about the bids.

In 2006, CCA posted a dip in operating profit of 5.5% to A$539.4m. Earnings were hit by a product recall in South Korea as well as high sugar, plastic and aluminium costs across the business. Surprisingly, earnings in South Korea rose last year, although the figures were boosted by a number of asset sales.