PHILIPPINES: Analysts doubt Coca-Cola Amatil will agree to San Miguel proposal

There are major doubts that Coca-Cola Amatil will sell back its Philippines bottling business to one of its major shareholders, brewing giant San Miguel.Apparently San Miguel has made an informal proposal to buy back Coca-Cola Bottlers Philippines for between $1 billion and $2 billion. But according to analysts the market is likely to react badly to any sale, especially as the value suggested is a far cry from the price CCA paid when it bought the business from San Miguel and Coca-Cola Co, three years ago. The proposal by San Miguel follows a 10% slump in consumption of Coca-Cola in the Philippines in 1999, a slump which CCA says is due to a general downturn in consumer confidence.A CCA spokesman said: "no proposal has been put to us." He continued by saying that CCA is forecasting an eventual return to sales growth in the Philippines, which had been 33% two years ago. San Miguel received 220 million CCA shares for its 70% stake in the company and the market was a major one for CCA, making up about 40% of its total sales.