New Delhi, Dec 11 (PTI) Global beverage major Coca-Cola on Wednesday announced sale of 40 per cent stake in its India bottling business Hindustan Coca-Cola Beverages Pvt Ltd (HCCBL) to Jubilant Bhartia Group.
Though the company has not disclosed the amount of the deal, some media reports have pegged it at around Rs 10,000 crore for 40 per cent stake in Hindustan Coca-Cola Holdings (HCCH).
The Bhartia family-led group in a statement said "they have entered into a definitive agreement for a strategic investment whereby Jubilant Bhartia Group will be acquiring a 40 per cent equity interest in Hindustan Coca-Cola Holdings Pvt Ltd, India (HCCH) through its entity Jubilant Beverages Limited. HCCH is the parent company of HCCBL, the largest Coca-Cola bottler in India."
The transaction is subject to regulatory approval.
Jubilant Beverages Ltd is a new entity incorporated this year in October by Jubilant Bhartia Group.
"This strategic investment will contribute to HCCB’s ongoing success and help strengthen its position in the Indian market," the statement said.
This deal is as part of The Coca-Cola Company's strategy to divest its stake in bottling operations globally as per its asset-light strategy.
HCCBL operates 13 factories and manufactures and sells 37 different products across 8 categories.
"With its diverse experience in various sectors, Jubilant brings decades of rich experience that will help accelerate the Coca-Cola system, enabling us to win in the market and provide greater value to local communities and consumers," Coca-Cola India President Sanket Ray said.
India is the fifth largest market for Coca-Cola globally.
Hindustan Coca-Cola Beverages CEO Juan Pablo Rodriguez said: "This strategic investment represents an important milestone in our journey. Jubilant Bhartia Group's expertise, complements our strengths, ensuring that we continue delivering exceptional value to our stakeholders while driving innovation and sustainable progress."
Shyam S Bhartia, Founder and Chairman and Hari S Bhartia, Founder and Co-Chairman of Jubilant Bhartia Group, said the investment is an ideal addition to their business.
"Together, we will leverage opportunities to grow the business to greater heights and ensure more Indian consumers can enjoy The Coca-Cola Company's refreshing portfolio of iconic local and international brands," a joint statement quoted them as saying.
Earlier this year, The Coca-Cola Company had franchised its bottling operations to its existing bottlers in three key markets - Rajasthan, Bihar, Northeast, and parts of West Bengal to its existing bottlers.
"The Coca-Cola Company’s locally-owned franchise partners in India are positioned to drive successful outcomes. The investment by Jubilant Bhartia Group family will contribute to the company’s ongoing success and help strengthen its position in the Indian market," the beverage major said.
The Coca-Cola Company had realised USD 290 million (around Rs 2,420 crore) by refranchising its bottling operations to its existing bottlers in three key markets.
Coca-Cola operates in the Indian market with two entities - Coca-Cola India and its bottling arm HCCBL.
Coca-Cola India, which takes care of branding and other businesses, had reported a consolidated revenue of Rs 4,713.38 crore in FY24. Its profit was down 41.82 per cent to Rs 420.29 crore.
HCCBL's revenue was up 10.10 per cent to Rs 14,021.54 crore in FY24 and the net profit soared three-fold to Rs 2,808.31 crore. HCCBL manufactures and sells 60 different products across 7 categories.
Its products include Coca-Cola, Thums Up, Sprite, Minute Maid, Maaza, SmartWater, Kinley, Limca, Fanta, and a lot more.
Jubilant Bhartia Group's Jubilant FoodWorks is a leading QSR chain operator in India and has businesses in other parts of the world also.
Jubilant's network comprises 3,130 stores across six markets India, Turkey, Bangladesh, Sri Lanka, Azerbaijan and Georgia.
The group has a portfolio of QSR brands in emerging markets with franchise rights for three global brands- Domino's, Popeyes and Dunkin' and two own-brands, Hong's Kitchen, an Indo-Chinese QSR brand in India, and a CAFE brand- COFFY in Turkey.
The Coca-Cola Company reentered the Indian market in 1993 after acquiring a host of brands including Thums Up from Ramesh Chauhan of Parle Bisleri.