MANILA, Philippines (UPDATE) - Coca-Cola FEMSA, the largest franchise bottler of Coca-Cola products, has acquired 51% of Coca-Cola Bottlers Philippines, Inc. for $688.5 million in cash.
In a statement, Coca-Cola FEMSA said it signed a definitive agreement with The Coca-Cola Company for the purchase of such stake.
Under the agreement, Coca-Cola FEMSA will have the option to acquire the remaining 49% of Coca-Cola Bottlers Philippines "at any time" within the seven years after the closing of the deal, expected in early 2013.
Coca-Cola FEMSA will also have a put option to sell its ownership to The Coca-Cola Company during the sixth year after closing.
"The Philippines has one of the highest per capita consumption rates of Coca-Cola products in the region and presents significant opportunities for further growth," Coca-Cola FEMSA said.
"Coca-Cola FEMSA believes that by leveraging its proven expertise and operating capabilities in an economy with vibrant growth prospects and an attractive socioeconomic and demographic profile, it will be capable to capture the opportunities and further improve the bottler’s operations and financial results," it added.
The Philippine bottler will be Coca-Cola FEMSA's first investment outside South America.
This is the fourth time control over Coca-Cola Bottlers Philippines will change hands in the last two decades.
In 1997, San Miguel, which had the franchise since 1927, sold it to Coca-Cola Amatil (Australia). In 2001, San Miguel and Coca-Cola (US) took control of CCBPI.
In 2007, San Miguel sold its 65% stake in CCBPI to Coca-Cola US for $590 million. Compare that with the $688.5 million Coca-Cola FEMSA is paying for a 51% stake.
Coca-Cola FEMSA, which produces and distributes Coca-Cola products to most Latin America countries, has 60 bottling facilities and serves more than 2.5 million retailers worldwide.
Coca-Cola Bottlers Philippines has 23 production plants that serve almost 800,000 customers. Sales of the firm is expected reach about 530 million unit cases of beverages this year. - With ANC