SWITZERLAND – Coca-Cola HBC, the world’s third-largest Coca-Cola anchor bottler in terms of volume, has acquired ESM Effervescent Sodas Management (ESM) from SICC Holding, for €45million (US$46m).
ESM is the owner of Three Cents an artisanal premium sparkling beverage and mixer brand.
The beverage is reportedly crafted without preservatives or artificial colorings and is designed for use in long drinks and cocktails.
The transaction is expected to be completed in the second half of 2022 and is subject to customary closing conditions and regulatory approvals.
As part of the acquisition, Three Cents’ founding team will remain with Coca-Cola HBC and will continue to promote the brand, providing leadership and vision.
The brand was founded in Greece in 2014 by founders George Bagos, Dimitris Dafopoulos, George Tsirikos, and Vassilis Kalantzis, a group of bartenders and Food & Beverage professionals.
Coca-Cola HBC noted that the Three cents brand complements its existing adult sparkling beverage portfolio, which includes Schweppes and Kinley.
“The adult super-premium sparkling beverage and mixer category represents an exciting growth opportunity and is an important pillar of Coca-Cola HBC’s 24/7 beverage partner strategy,” Coca-Cola HBC said.
Coca-Cola HBC caters to a growing range of consumer tastes and consumption occasions with one of the beverage industry’s broadest and most flexible portfolios.”
Coca-Cola HBC reports shrinking business in Russia amid growth in other markets
Meanwhile, the Switzerland-based bottler of Coca-Cola products has incurred a one-time hit of €190 million (US$195.36 million) in the first half due to costs related to its business in Russia.
The company said the shortfall in revenue in the Russian business is after it stopped the sale of Coca-Cola drinks in the country following the Ukraine war.
The London-listed firm, which once counted Russia as one of its biggest markets, also expects to sustain financial charges of about €82 million (US$ 84.74m) in the second half.
This is due to a depletion of all of its stocks and would no longer produce or sell Coca-Cola or other brands of the Coca-Cola Company in Russia.
Coca-Cola HBC, however, said its group’s net sales revenues had grown 29.6% to €4.2billion (US$4.34bn).
The organic revenue growth came to 19.4% while the net profit had a 34.4 % fall to about €153 million (US$158.10m) for the six months ending July 1, hit by the charges.
The group’s underlying earnings margin contracted 420 basis points to 6.5%, dragging operating profits down to €275.7million (US$284.90m), a 21.3% drop.
Even though the Russian business revenue is shrinking, the company has reinstated its forecast, expecting comparable operating profit for the group in 2022 to be between €740 million and €820 million.
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