WEDNESDAY, 9.30AM:
The SA Breweries-controlled Amalgamated Beverage Industries is to acquire Suncrush in a R1,9-billion deal payable in cash and equities that will see ABI controlling 60% of SA’s soft drinks industry.
ABI is already the largest Coca-Cola bottler in SA, holding the franchises for Gauteng and metropolitan Durban. ABI’s acquisition of Suncrush, which holds the Coca-Cola bottling franchise in rural KwaZulu-Natal and North-West province, will make it the second largest Coca-Cola bottler in the world.
In a statement announcing the deal, the companies said Suncrush will receive R986-million in cash, of which R197,2-million will come from SAB, as well as 14,4-million ABI shares and 3,2-million SAB shares. The deal is, however, subject to certain unspecified conditions, believed to relate to the need for Competition Board approval, the status of Suncrush’s 20% stake in Eastern Cape bottler Kilimanjaro, and black empowerment aspects of the deal.
ABI marketing manager Brady Harris said the companies foresee no problems with competition policy, as the deal applies only to Coca-Cola bottlers holding geographically demarcated franchises, meaning they are technically not competitors. Brady added that the deal has the blessing of Coca-Cola’s US headquarters.
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