Aboitiz Equity Ventures and International Partner Will Acquire the Coca-Cola Business in the Philippines

Aboitiz Equity Ventures (AEV) and its partner Coca-Cola Europacific Partners (CCEP) is planning to jointly acquire Coca-Cola Beverages Philippines Inc., the franchise bottler of Coca-Cola products in the country, AEV announced on Wednesday (August 2). 

CCEP, which is headquartered in England, is the company that handles bottling for Coca-Cola products in markets like Australia, New Zealand, and Indonesia.

AEV said it is submitting a letter of intent to acquire 100 percent of CCBPI from Atlanta-based the Coca-Cola Company Inc. based on a 60-40 ownership structure, with CCEP claiming majority ownership. The announcement did not immediately disclose the value of the transaction, although various media reports pegged it at $1.8 billion (about P99.3 billion).

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When the deal is consummated, CCEP will reportedly become the largest bottler of Coca-Cola products by revenue and volume.

“CCEP’s proposed acquisition of CCBPI, with AEV, one of the leading conglomerates in the local market, offers a great opportunity to co-acquire an established, well-run business with attractive profitability and growth prospects,” both companies said in separate statements.

For AEV, the company said the acquisition “would build on AEV’s portfolio diversification strategy to enter the branded consumer goods space and on CCEP’s successful expansion in to the Asia Pacific region via its acquisition of Coca-Cola Amatil in 2021.” 

The acquisition follows TCCC’s earlier pronouncements that it would divest from bottling operations.

CCBPI currently has 19 manufacturing plants and around 9,000 employees in the country.

“The proposed acquisition is subject to a number of conditions, including satisfactory completion of confirmatory due diligence which is well underway, receipt of AEV and CCEP’s board approvals, and the parties signing definitive agreements,” the statement said.

AEV has interests in power, banking and financial services, infrastructure, data science and technology, among others.

AEV and CCEP’s acquisition of CCBP is the latest in the long history of Coca-Cola in the Philippines. Here’s a brief timeline

History of the Coca-Cola Business in the Philippines

1927 -- Coca-Cola carbonated drinks is brought to the Philippines by San Miguel Corp., one of the U.S. beverage company’s first international bottlers.

1981 -- San Miguel establishes Coca-Cola Bottlers Philippines Inc. (CCBPI) in partnership with The Coca-Cola Company (TCCC) of Atlanta to manufacture and sell the popular soft drink in the country.

1987 -- San Miguel sells its 70 percent in CCBPI for $2.7 billion to Coca-Cola Amatil Ltd. (CCA), the Australia-based franchise bottler for Australia, New Zealand, Indonesia and South Pacific. The deal results in San Miguel owning 25 percent of CCA.

2001 -- San Miguel reacquires 65 percent of CCBPI while TCCC buys the remaining 35 percent in a deal worth $1.24 billion.

2006 -- TCCC acquires San Miguel’s 65 percent stake in CCBPI for $590 million and takes full control of the bottler. Volume sales dropped sharply in the previous two years due to what the Atlanta-based company calls “affordability and availability issues.”

2012 -- Coca-Cola FEMSA of Mexico buys a 51-percent stake in CCBPI from TCCC for $688.5 million in cash. The Atlanta-based company retains ownership of 49 percent of the Philippine bottling business. Coca-Cola FEMSA was the world’s largest franchise bottler of Coca-Cola products. This was the company’s first operation outside of Latin America and was seen as a potential jumpoff point for expansion in the rest of Asia Pacific.

2018 – Coca-Cola FEMSA exits the Philippines by selling its majority stake in CCBPI back to TCCC. CCBPI was renamed Coca-Cola Beverages Philippines. (CCBP).