The Coca-Cola Company is delaying what would have likely been the biggest new listing on the JSE this year, that of Coca-Cola Beverages Africa (CCBA), until next year.
The Coca-Cola Company first announced in April last year that it planned to sell a portion of its shareholding in CCBA via an initial public offering (IPO), with listings on the JSE and Amsterdam.
The decision to delay the listing comes at a time of falling global equity investor sentiment as low global growth, rising interest rates, increasing inflation and geopolitical uncertainty from the conflict in Ukraine and Covid-19 lockdowns in China are driving down global equity prices.
According to Bloomberg, the Coca-Cola Company was seeking a value of $8.1 billion (R128.4bn) for the listing of the eighth largest Coca-Cola bottling partner in the world by revenue, and the largest on the continent.
Coca-Cola holds 66.5 percent of CCBA - in 2016 it paid $3.15bn to buy Anheuser-Busch InBev out of the African bottling joint venture. CCBA’s other shareholder is Gutsche Family Investments, with a 33.5 percent stake.
“The Coca-Cola Company will continue to evaluate macro-economic conditions in deciding future timing for an IPO in 2023. Plans to have an Africa-focused bottler traded as an independent public company remain unchanged,” the Coca Cola Company said in a statement yesterday.
It said the decision to list CCBA was in line with the Coca-Cola Company’s objective of focusing its resources on building consumer-loved brands and innovation.
The Coca-Cola Company sells beverages in more than 200 countries. CCBA accounts for over 40 percent of all Coca-Cola products sold in Africa by volume. With over 17 000 employees in Africa, CCBA services more than 600 000 customers with international and local brands.
CCBA was formed in July 2016 after the combination of the southern and east Africa bottling operations of the non-alcoholic ready-to-drink beverages businesses of The Coca-Cola Company, SABMiller plc and Gutsche Family Investments.
CCBA operates in 14 countries, including its six key markets South Africa, Kenya, Ethiopia, Uganda, Mozambique and Namibia, as well as Tanzania, Botswana, Ghana, Zambia, the islands of Comoros and Mayotte, eSwatini and Lesotho.
Earlier this year CCBA said its growth opportunities were being driven by Africa’s young population and growing urbanisation, offering the potential for increased per capita consumption, particularly in the categories of juice, water and energy drinks. Energy drinks were the fastest-growing soft drink category in Africa.
edward.west@inl.co.za
BUSINESS REPORT