Varun Beverages extends acquisition timeline for SBC Beverages Ghana to March 2025

GHANA – Varun Beverages Ltd (VBL), PepsiCo’s largest franchise bottler, has extended the timeline for completing its planned acquisition of SBC Beverages Ghana Ltd from Ghana Bottling Company Ltd.  

Initially set for completion by February 28, 2025, the transaction is now expected to be finalized by March 31, 2025, pending regulatory approvals, including from PepsiCo Inc. 

“We would like to update that consummation of the aforesaid transaction is extended up to March 31, 2025, instead of February 28, 2025 (as intimated earlier on November 12, 2024),” VBL stated in a regulatory filing. 

VBL had entered into a share purchase agreement on November 13, 2024, to acquire 100% of SBC Beverages Ghana for US$15.06 million.  

The deal is part of the company’s broader expansion strategy in Africa, which also includes a US$154.50 million acquisition of Tanzania Bottling Company SA. 

To support its growth and acquisition plans, VBL raised Rs 7,500 crore in 2024 through a Qualified Institutional Placement (QIP). The funds are primarily allocated toward debt repayment and strategic acquisitions. 

Despite its expansion, VBL faced margin pressures in the fourth quarter of 2024, as rising raw material costs offset volume growth, particularly in its African markets.  

The company reported a net profit of Rs 185 crore (US$21.12 million), marking a 40% year-over-year increase. However, the figure fell short of analysts’ expectations, which projected profits of Rs 211 crore (US$24.3 million), according to LSEG data. 

VBL’s full-year revenue from operations reached Rs 143,486 million (US$1.65 billion), up from Rs 126,328 million (US$1.46 billion) in the previous year. The growth was driven by organic volume expansion and a diversified product mix. 

Chairman Ravi Jaipuria highlighted the company’s aggressive expansion in Africa, citing new geographical entries and strengthened distribution networks.  

“We are pleased to conclude CY2024 on a strong note through adding geographical presence into new territories of South Africa along with distribution rights in Namibia, Botswana, Mozambique, and Madagascar. We also started greenfield operations in the Democratic Republic of Congo (DRC),” he said. 

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