SOUTH AFRICA – The Appletiser plant of Coca Cola Beverages SA (CCBSA) in Elgin is set to almost double annual production by October as a result of its integration into the CCBSA supply chain grid.
Appletiser SA, a wholly owned subsidiary of CCBSA following the merger last year of the non-alcoholic ready to drink bottling operations of The Coca-Cola Company, SABMiller PLC and Gutsche Family Investments to form CCBSA, produces 59% of all Tiser products for domestic and global distribution at the Elgin plant.
There are plans in place for Elgin to produce additional Coca-Cola brands (in addition to Tisers) that are currently produced at the other CCBSA manufacturing sites.
With the addition of 200ml, 330ml and 440ml cans of other Coca-Cola products, the facility will produce well in excess of prevailing volumes at the time of the merger.
In May CCBSA sold 17.5% of its shareholding in Appletiser SA to black owned investment company African Pioneer Group and 4% to a new entrant black empowerment partner, Sipho Excellent Madlala, a 20-year veteran of the company.
The sale of the equity stakes was sealed after a rigorous process of evaluation and selection, facilitated by Standard Bank.
It meets one of the merger conditions agreed to with the Competition Tribunal in relation to the creation of CCBSA last year.
CCBSA managing director Velaphi Ratshefola said the company was confident that Appletiser SA has the capacity to increase production output considerably to serve the domestic market and to be used as a base for export to the rest of the continent and elsewhere in the world.
Appletiser has a commitment in terms of the merger agreement to maintain procurement of at least 80% of apples, pears, grapes and similar fruit inputs used for juice concentrate used in Tiser products from South Africa.
Currently all apple and pear concentrate is sourced from South Africa, with grape concentrate increasingly sourced locally, depending on availability and affordability of supply.
Since the time of the merger in May 2016, Appletiser’s contractual obligations in terms of local procurement of grapes used for juice concentrate for Grapetiser has increased significantly from 11% to 43%.
This percentage will continue to increase in the next few years as agreed with the Competition Tribunal.
Apart from Elgin, the Tiser brands are produced at another South African facility in Midrand, and at facilities in the UK, Canary Islands, Belgium and Australia.
Tiser products produced at ASA are marketed in a range of territories including Botswana, Namibia, Zambia, Lesotho, Mozambique, Japan, Australia, New Zealand, Hong Kong, Mauritius and Swaziland.
In terms of the merger agreement, CCBSA’s cooler compliance has been fully audited, the company has held a supplier development conference as agreed and retained staffing levels at the levels as at the time of the merger, regardless of restructuring.
CCBSA has also made good progress on its SMME Investment and Agricultural Fund.
June 28, 2017: Fin24