The Turkish beverage giant Coca-Cola İçecek (CCI) has signed an acquisition contract to purchase Coca-Cola Bangladesh Beverages Ltd (CCBB) for a staggering $130 million, a strategic move to bolster its position in the South Asian market.
A subsidiary of The Coca-Cola Company (TCCC) and CCI, through its wholly-owned subsidiary CCI International Holland B.V. (CCIHBV), signed the share purchase agreement (SPA).
The agreement specifies that CCIHBV will become the principal direct shareholder and that the full 100% of CCBB`s shares would be acquired.
As a major participant in the creation, marketing, and distribution of sparkling and still brands under The Coca-Cola Company`s ownership, CCBB plays a crucial role in Bangladesh.
As per the terms of the agreement, CCI is set to acquire the complete shareholding of CCBB at an equity value (Equity Value) determined by subtracting CCBB`s estimated net financial debt as of the closing date from an enterprise value of $130 million. A post-closing price adjustment mechanism will come into play after a comprehensive closing audit to ascertain the precise net financial debt amount of CCBB as of the closing date.
The acquisition is anticipated to be funded through CCIHBV`s existing cash resources, and it is expected to have a modest impact on CCI`s net leverage.
This strategic move not only expands CCI`s global footprint but also underscores its commitment to capitalizing on growth opportunities in emerging markets. The acquisition is subject to regulatory approvals and customary closing conditions and is expected to further solidify CCI`s position as a major player in the beverage industry on the Indian subcontinent.
Karim Yahi, CEO of CCI said, "We are very pleased to sign the share purchase agreement to acquire CCBB, which we see as a great opportunity to enter a market with significant future potential, where growth and value can be generated by deploying CCI`s core capabilities. This acquisition also creates a more diverse geographical footprint for CCI and solidifies its alignment with TCCC."
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