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The Gutsche family is relinquishing a significant chapter of its African franchise. Through their investment vehicle, Gutsche Family Investments, the family has agreed to sell its 33.48 per cent stake in Coca-Cola Beverages Africa to Coca-Cola HBC in a transaction that values the business at around US$3.4 billion.
The sale ends eight decades of Gutsche family involvement in the Coca-Cola system across Southern and Eastern Africa. The family will, however, retain its stake in Coca-Cola HBC after the deal closes.
Coca-Cola Beverages Africa operates across 14 markets and accounts for roughly 40 per cent of the continent’s Coca-Cola volume. Its transfer to Coca-Cola HBC will consolidate the bottler’s reach to more than half of Africa’s population through a single platform.
The deal has several components. The Coca-Cola Company will divest 41.52 per cent of its 66.52 per cent share in Coca-Cola Beverages Africa to Coca-Cola HBC. At the same time, Coca-Cola HBC will purchase the 33.48 per cent held by Gutsche Family Investments. An option allows Coca-Cola HBC to acquire the remaining 25 per cent within six years.
For the Gutsche family, this marks the end of a long era of direct operational control in Africa. Their association with Coca-Cola began in the 1940s in South Africa, when they acquired bottling rights that later grew into one of the most important franchises on the continent. The family took full control of the business in 1960.
Once the deal is completed, Coca-Cola expects to reduce its direct bottling operations to around 5 per cent of net revenue as part of its refranchising strategy.
