Coca-Cola Beverages Africa will be the worlds tenth-largest Coca-Cola bottler

Coca-Cola Beverages Africa will be the world's tenth-largest Coca-Cola bottler

SABMiller has secured an agreement with The Coca-Cola Co and the majority shareholders in Coca-Cola Sabco to create the world's tenth largest Coca-Cola bottler.

The new entity, which will be known as Coca-Cola Beverages Africa (CCBA), will comprise bottling operations in 12 markets across southern and east Africa. Pro forma sales for the unit total around US$2.9bn per year and volumes amount to 41m hectolitres, SABMiller said today.

The combined operations will be 57% owned by SABMiller and 31.7% controlled by Gutsche Family Investments. The Coca-Cola Co will own 11.3% of CCBA.

“With more than 30 bottling plants and over 14,000 employees, Coca-Cola Beverages Africa will be the largest Coca-Cola bottler on the continent, with the scale, complementary capabilities and resources to capture and accelerate top-line growth,” said SABMiller.

CEO Alan Clark added: “Soft drinks are an important element of our growth strategy. This transaction increases our exposure to the total beverage market in Africa. The opportunity is significant, with favourable demographics and economic development pointing to excellent growth prospects,

“This also signifies a strengthening of our strategic relationship with The Coca-Cola Co.”

Earlier this month, Clark claimed that the company has upped its focus on soft drinks in emerging markets in a bid to mirror beer's growth in the regions. His comments prompted speculation that SABMiller, which is already the largest Coca-Cola bottler in South Africa and handles the brands in Swaziland, Zambia and Botswana, could look to Coca-Cola to boost its presence in soft drinks.

CCBA will be headquartered in South Africa.

For coverage of SABMiller's post-announcement analyst call, click here.