Coca Cola bottlers pop with European merger

THREE European bottlers of Coca Cola beverages, including manufacturers in Wakefield, have agreed to merge.

Coca Cola Enterprises has agreed to merge with the beverage maker’s subsidiary in Germany, CCEAG, and Coca Cola Iberian Partners.

The deal is structured as a tax inversion, with CCE moving its headquarters from Atlanta, US to London, so it can cut exposure to higher US taxes.

The company will be called Coca-Cola European Partners (CCEP) and will generate about £8.12bn per year.

It hopes to cut costs of up to £242m within three years.

This follows Coca-Cola Enterprises announcement of its Q1 results, in which profit fell 11.1% to £113m, after negative foreign currency translation, and as customers buy fewer fizzy drinks.

The UK subsidiary also has manufacturing sites at Morpeth, Edmonton , Milton Keynes, East Kilbride and Sidcup.

Muhtar Kent, Coke’s chief executive said, “It’s a major milestone and major transaction that will benefit all parties involved.”

In a statement to the Atlanta Business Chronicle, John Brock, Coca-Cola Enterprises chairman said: “The creation of Coca-Cola European Partners will build on each bottler’s capabilities to create more efficient operations in their respective markets across Western Europe,”
“This transaction offers clear synergies, along with the scale to better serve the needs of our customers and consumers in Western Europe, to become an even stronger partner to The Coca-Cola Company and create increased value for CCE’s shareowners.”