Coca-Cola investing $1 billion in Philippine market after Aboitiz deal

MANILA, Philippines – The Coca-Cola Company is bullish on the Philippine market as it announced a $1-billion investment, just days after it finalized the sale of its local bottling unit to Aboitiz Equity Ventures (AEV) and the latter’s business partner, Coca-Cola Europacific Partners (CCEP).

The amount, which will be spent in the next five years, would be used to fuel its expansion to serve the country’s “growing and young consumer base.”

The commitment was announced in a courtesy call on President Ferdinand Marcos Jr. at Malacañang on Monday, February 26.

“We generate 100,000-plus [employees] throughout the distribution, through our supplies…. And we’re very enthusiastic and we see, we need to invest in the Philippines, invest to grow the business. And in the next five years, we’re planning for [a] $1-billion investment, and in fact, we’re even doing a new plant, which we are building in Tarlac,” CCEP chairperson Sol Daurella Comadrán was quoted as telling Marcos.

The Coca‑Cola Company and its bottling partners are collectively known as the Coca‑Cola system. The Coca‑Cola Company does not own, manage, or control most local bottling companies. Instead, it earns by selling concentrates and syrups to authorized bottling partners. Its bottling partners combine the concentrates with still or sparkling water and sweeteners.

Last Friday, February 23, AEV and CCEP completed the acquisition of Coca-Cola Beverages Philippines Incorporated (CCBPI), the bottling arm of Coca-Cola in the country.

The acquisition was valued at $1.8 billion and will have a 60-40 sharing arrangement between CCEP and AEV, respectively. 

CCBPI manufactures both non-alcoholic and alcoholic beverages, with 17 brands including Coke, Royal, Sprite, Wilkins, Viva, and Nutri Boost. These brands are now under AEV’s consumer goods portfolio.

“This significant investment from The Coca-Cola Company highlights our shared commitment to the Philippines’ growth and development. We are confident that this partnership will create lasting value for our stakeholders and contribute positively to the Philippine economy,” said Aboitiz Group president and chief executive officer Sabin Aboitiz. – Rappler.com