Regional competition regulators have opened a formal inquiry into a proposed majority takeover of Coca-Cola Beverages Africa (CCBA) that could reshape Coca-Cola’s bottling structure across Africa, including Kenya’s fast-growing soft-drink market.
- •Coca-Cola HBC AG and its subsidiary Coca-Cola HBC Holdings B.V. are seeking to acquire a 75% stake in CCBA, one of the continent’s largest beverage bottlers with operations in several markets including Kenya, Uganda, Ethiopia and Zambia.
- •Kenya is emerging as a central point of interest in the probe given CCBA’s extensive local footprint in manufacturing, packaging and distributing Coca-Cola-branded drinks ranging from sodas and bottled water to juices and energy beverages.
- •Coca-Cola HBC, which is listed on the London Stock Exchange, currently operates in 29 countries across Europe, Eurasia and Africa and maintains direct operations within the COMESA Common Market mainly in Egypt.
CCBA, the largest Coca-Cola bottler in Africa, was created in 2016 through the consolidation of bottling operations linked to The Coca-Cola Company, SABMiller and Gutsche Family Investments (GFI), creating one of Africa’s largest non-alcoholic ready-to-drink beverage networks headquartered in Johannesburg. It operates in 14 countries on the continent and accounts for about 40% of all Coca-Cola product volume sold across Africa.
Coca-Cola will sell 41.52% out of its 66.52% stake in CCBA to Coca-Cola HBC, and Coca-Cola HBC is acquiring 33.48% of CCBA that is held by GFI. In total, the transaction values 100% of CCBA at an equity value of US$3.4 billion. Coca-Cola and Coca-Cola HBC have also agreed to a separate option agreement for Coca-Cola HBC to acquire the remaining 25% of CCBA still owned by Coca-Cola within a six-year period from closing.
A successful acquisition would significantly deepen Coca-Cola HBC's presence in Eastern and Southern Africa through CCBA’s established manufacturing and logistics infrastructure. The ongoing inquiry will assess whether the proposed transaction could reduce competition or negatively affect public-interest factors such as market access for smaller beverage players and pricing outcomes for consumers.
The proposed consolidation could also deliver operational efficiencies and supply-chain improvements but may also raise concerns over market concentration and the bargaining power of a dominant bottling network over retailers and agricultural suppliers.
If complete, Coca-Cola HBC will represent two-thirds of Africa’s total Coca-Cola system volume and cover over 50% of the continent’s population. As part of the acquisition, Coca-Cola HBC will pursue a secondary listing on the Johannesburg Stock Exchange.
