Three Coca-Cola bottlers agree to merge

LONDON: CocaCola Enterprises (CCE.N), a European soft drink bottler, is to combine with CocaCola Iberian Partners (CCIP) and the German bottling business of Coca-Cola Co (KO.N), the companies said on Thursday, creating the world's largest independent bottler of Coke drinks by revenue, with business in 13 countries.

The new company, to be called Coca-Cola European Partners, will have annual revenue of $12.6 billion and earnings before interest, tax, depreciation and amortization (EBITDA) of $2.1 billion.

CCE's shareholders will own 48 percent of the company, with CCIP's shareholders owning 34 percent. Coca-Cola, the world's largest soft drink maker, will own 18 percent. CCE shareholders will receive one share of the new company, CCEP, and a one-time cash payment of $14.50 per share. The new company will be headquartered and incorporated in London and its shares will be traded on Euronext Amsterdam, the New York Stock Exchange and the Madrid Stock Exchange.

The combination is expected to result in synergies of $350 million to $375 million within three years of closing, helped by operating efficiencies, cost-savings and scale benefits. The bottlers purchase soft drink concentrate from CocaCola Co, and then bottle and distribute the drinks. The new company will use its savings to increase investment in marketing and sales. John Brock, current chief executive of CCE, will be CEO of the new group, while Sol Daurella, executive chairwoman of CCIP, will be chairwoman.