Fraser & Neave has said that the expected loss of bottling and distribution contracts with The Coca-Cola Co in Singapore will not damage the group's finances.

Fraser & Neave said this week that it did not expect The Coca-Cola Co (TCCC) to extend its contract with the firm in Singapore beyond the current expiry date of January 2010.

Responding to investor concern, the group said yesterday (19 February): "No adverse financial impact on [the company] will arise from the non-renewal of the agreements with TCCC in Singapore."

Under the current arrangement, which was first signed in 1999, a range of both Coca-Cola and Fraser & Neave drinks are produced and distributed by Fraser & Neave Coca-Cola Singapore, under a trademark licence agreement. This agreement will expire in January 2010.

F&N said yesterday that it "looks forward to regaining control of distribution of F&N soft drinks in Singapore". Koh Poh Tiong, head of Fraser & Neave's food and beverages division, said that the group wanted to "revive" the brands.

He added: "We will invest in marketing and distribution infrastructure in Singapore. Getting 100% of the income from the sales and manufacture of F&N soft drinks will be a good foundation for future earnings of the food and beverages business under my charge."