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Coca-Cola Co. to buy out AB InBev's stake in largest African bottling business

Published: 09:28 21 Dec 2016 EST

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Coca-Cola Beverages Africa is based in South Africa and owns more than 30 bottling plants in 10 countries across southern and eastern Africa

The Coca-Cola Company (NYSE: KO.) has agreed to buy out a 54.5% stake in the soft-drink firm's largest African bottling business from merged beer giant Anheuser-Busch InBev SA.

Coke is paying the brewer US$3.15bln to exercise a change-of-control clause for the business, which it plans to refranchise to another partner, after AB InBev obtained control of the stake when it bought UK rival SABMiller PLC.

Coca-Cola Beverages Africa is based in South Africa and has operations, including more than 30 bottling plants, in 10 countries across southern and eastern Africa.

Coke and South Africa-based Gutsche Family Investments, another long time bottling partner, own the rest of the business.

For AB InBev, the deal represents its latest asset sale since its $100bln-plus takeover of SABMiller, for which it won regulatory approval a few months ago.

Coke and InBev also announced Wednesday that they had reached an agreement for the soft-drinks company to separately buy the brewer's interest in bottling operations in Zambia, Zimbabwe, Botswana, Swaziland, Lesotho, El Salvador and Honduras for an undisclosed amount.

Coke also plans to refranchise those operations and expects both deals with AB InBev to close by the end of 2017.

The soft drinks giant’s chief executive officer, Muhtar Kent said:  “We will move forward with our long-term strategic plan in these important growth markets.

He added: “We are continuing negotiations with a number of parties who are highly qualified and interested in these bottling territories and look forward to refranchising these territories as soon as practical following regulatory approval.”

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