Varun Beverages to buy PepsiCo’s South Africa bottler

PTI

New Delhi, December 19

Varun Beverages Ltd (VBL), PepsiCo’s largest franchise bottler, on Tuesday announced the acquisition of South Africa-based Beverage Company (Bevco) along with its wholly owned subsidiaries at an enterprise value of Rs 1,320 crore, which will help it expand geographical footprint in the African market.

Rs 1,320-crore deal

• South Africa-based beverage firm Bevco has five facilities — two in Johannesburg and one each in Durban, East London and Capetown
• The bottler expects to complete the transaction before July 31, 2024

Bevco holds franchise rights from PepsiCo in South Africa, Lesotho and Eswatini. It also has distribution rights for Namibia and Botswana. It also owns beverage brands such as Refreshhh, a high-caffeine content drink, Reboost, an energy drink, Coo-ee, a carbonated drink in classic flavours and JIVE, which is a fizzy Lemonade.

The “proposed transaction is valued at ZAR 3 billion (Rs 1,320 crore),” it said.

VBL expects to complete the transaction, which is “cash consideration” before July 31, 2024.

Bevco had a net revenue of Rs 1,590 crore in FY23, the filing added.

Bevco has five manufacturing facilities — two in Johannesburg and one each in Durban, East London and Capetown and has an installed capacity of 3,600 BPM (bottles per minute).

“The acquisition will enable VBL to expand its geographical footprint in Africa,” said VBL in a regulatory disclosure.

South Africa is the largest soft drinks market in the African continent, which is expected to grow at a CAGR of 5.3% for the next four years till 2027.

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