Big Beer, Wine and Soft Drinks Firms Vie for Majority Stake in CCBA

Big multinational beer, wine and soft drinks firms are competing for the 57% majority stake in Coca-Cola Beverages Africa (CCBA).

First reported by Reuters and Bloomberg in April, Heineken, Coca-Cola Hellenic and Castel Group are among companies that have bid for a majority stake in CCBA, according to people familiar with the matter.

The Coca-Cola Company (TCCC) agreed to acquire the 54.5% stake formerly held by SABMiller from AB InBev after the big beer merger closed last year.

While we are currently having exploratory discussions with potential partners, including existing partners who are highly qualified and interested in these bottling territories, we cannot comment on any potential partners while this process is under way,” said Kent Landers, a Coca-Cola spokesperson.

None of the firms would comment on this story.

All three companies are large bottlers of Coca-Cola products in Africa.

Coca-Cola HBC is the bottler of Coca-Cola products in Nigeria (NBC) and 27 European countries.

Heineken N.V. also bottles for the soft drinks giant in Central Africa (La Reunion, Burundi, Congo, DRC and Rwanda).

Castel Group has an even far bigger relationship with Coca-Cola. It was the second largest Coke bottler in Africa behind SABMiller before the beer merger. Its stakes cover French speaking West Africa, Angola and Mozambique.

To underscore the importance of soft drinks to these companies, the head of Heineken Africa business unit, Siep Hiemstra back in 2014 said that it expects the group’s Coca-Cola franchises in the region to double volumes by 2020 as they take the same demographics boosting beer.

The dynamics we speak about in beer – a high GDP and people moving into the city – all these elements are not exclusive for Heineken. It is also what Coca-Cola depends on. So when you bring (beer and soft drinks) together, it works.

He added that “the franchises are something we feel strongly about but have never really talked about.” He explained that the franchises bring consumers into the brewer’s network at a younger age.

In Heineken, we pick consumers up at the legal drinking age. In Coca-Cola we pick them up far earlier,” he noted.

Also acquired from AB InBev for refranchising is Coca-Cola bottling operations in Zambia, Zimbabwe, Botswana, Swaziland, Lesotho, El Salvador and Honduras.

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