The stock of Anheuser Busch Inbev NV (ADR) (NYSE:BUD) closed at $122.40 gaining 0.65% in yesterday’s trading session. Coca-Cola (NYSE:KO) has spent $3.15 billion to purchase this company’s 54.5% equity stake Coca-Cola Beverages Africa.
The deal was struck in December 2016 and it included the sale of CCBA’s operations in Ghana, South Africa, Uganda, Namibia, Kenya, Comoros and Mayotte. CCBA was formed in 2016 and is known globally as an enormous and trusted Coca-Cola bottler in Africa. It was founded by a merger between The Coca-Cola Company, the African non-alcohol ready-to-drink bottling interests of SABMiller plc and Gutsche Family Investments.
The recent transaction is going to play a huge role towards expanding Coca-Cola Company’s footprint in the companies mentioned above.
Coca-Cola intends to take up a controlling interest in CCBA upon the completion of this particular acquisition. To this particular moment, this company hasn’t yet found an appropriate refranchising partner. It has resolved to temporarily hold these businesses until it identifies the partner. The company has given its word about the matter terming the assets discontinued operations for the time being.
Additionally, Coca-Cola and AB InBev are currently finalizing a deal that will see them sell AB InBev’s interest in bottling businesses in Zimbabwe, Zambia, Swaziland, Botswana, El Salvador, Lesotho and Honduras.
An analyst following the deal closely opined, “While the beer space has been grappling with intense competition, consumers’ changing preferences and sluggish North American growth, AB InBev has been riding on robust geographical reach and diversified brand portfolio.”
AB InBev’s spokesperson in a recent interview outlined that the company was headed towards the right education. He exuded confidence that the company was placing itself on the right path towards fetching high revenues.
Business competition is a reality that every company in the market is aware of. That is one if the reasons why the company has adopted new policies and business strategies. The company is now, more than ever determined uphold its relevance in the market as well as build its reputation.