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Clifford Chance advises Coca-Cola on the re-alignment of its mainland China bottling system

29 November 2016

Clifford Chance advises Coca-Cola on the re-alignment of its mainland China bottling system

Leading international law firm Clifford Chance advised The Coca-Cola Company on the signing of definitive agreements relating to the re-alignment of the company's bottling operations in China, its third largest market by volume. The re-alignment involves the following inter-conditional transactions:

  • Coca-Cola's Bottling Investments Group disposing all of its bottling units in China which are engaged in the manufacture, distribution and sale of non-alcoholic ready-to-drink (NARTD) beverages to Swire Beverages Holdings Limited (Swire) and COFCO Coca-Cola Beverages Limited (COFCO) respectively
  • Swire and COFCO swapping certain of their respective NARTD beverages bottling units in China
  • Swire acquiring the 12.5 percent interest in Swire Beverages Limited which is not already owned by Swire from a subsidiary of Coca-Cola.

The above transactions together involve an aggregate value of approximately US $1.4 billion and will result in a division of the Coca-Cola bottling system in China between COFCO and Swire.

Closing of these transactions is subject to satisfaction of various conditions, including regulatory approvals from the relevant government authorities.

The deal was led by M&A partner Amy Ho, with support from senior associate Bryan Koo, associates Annie Liu and Michelle Kwok, and trainee solicitor Sanborn Li in Hong Kong, counsel Yang Yi and Paula Liu, and trainee solicitors Zhang Chao and Yuge Hong in Shanghai. The firm's antitrust offering was delivered through Beijing partner Richard Blewett who was supported by counsel Bai Yong.

Amy Ho said, "This transaction marks an important chapter in the ongoing evolution of Coca-Cola's business. China represents a significant long-term growth opportunity for Coca-Cola and its bottling system and we are delighted to support the company's continued efforts to leverage greater capability and efficiency throughout the region; itself a fast-paced and ever-changing marketplace."