HONG KONG: Coke secures lion’s share of bottling JV
Coca-Cola Co. has bought a major stake in its bottling joint venture in China.
The firm confirmed today (29 August) that it has bought a controlling shareholding in Kerry Beverages, its bottling joint venture with the Kerry Group - a conglomerate based in Hong Kong. Financial details of the purchase were not disclosed.
Coke now holds 89.5% of Kerry Beverages, and has agreed to buy the remaining stake by the end of 2008.
Kerry Beverages was formed by the two companies in 1993, and has majority ownership in 11 joint ventures that manufacture and distribute Coke's products across nine provinces in China. Kerry Beverages also has a minority interest in the joint venture bottler for Beijing.
The transaction does not affect the local shareholding structure of the bottlers in China, Coke noted.
"Our partnership with Kerry Beverages over the past 14 years has allowed our business in China to establish a strong foundation for continued growth," said Muhtar Kent, president, Coca-Cola International. "We are also grateful to Kerry for its future support of our long-term commitment to China and look forward to continued cooperation."
"It has been a productive and successful partnership with Coca-Cola," added Thomas Lui, Kerry Beverage's managing director. "With the change in the shareholding structure, we will be focusing on our core business areas, while Coca-Cola Co. will continue to grow the thriving operations in China."
Kerry Group is looking to increase the focus on its core business areas, namely hotel management, property development and logistics.
After the transaction, Coke's dedicated function to manage its bottling operations, the Bottling Investments Group, will lead the management of KBL.
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