Eight become one in German Coke consolidation

By Neil Merrett

- Last updated on GMT

Related tags Coca-cola Soft drinks

Coca-Cola's German bottlers yesterday agreed to consolidate their
operations under a single company to better tap the growing
potential of its brands in the country.

The move reflects a growing trend among food and beverage processors to streamline operations in order to better deal with cost and distribution challenges in their respective markets. The decision now waits on approval by the supervisory board of Coca-Cola Erfrischungsgetranke (CCE AG), which would represent the consolidated group. However, If an agreement is reached, then from 1 September this year, the eight companies currently responsible for production and distribution of Coca-Cola's brands in the country would combine their operations. Coca-Cola, alongside many soft drinks firms, has seen profits and margins under fire over the last couple of years as it has struggled to cope with a shift in consumer demand away from carbonated soft drinks. This has been especially true of the German market, which last year was identified as a significant contributor to a 21 per cent fall in European drinks sales for the company during the first quarter of the fiscal year. However, on the back of the improving demand for Coca-Cola's brands, CCE AG chairman Damian Gammell believes the restructured company can better serve its customers, while also increasing the potential of its brands in the country. The combined operation will boast sales volume of approximately 3.5 billion litres, 28 production plants, and a portfolio of 50 beverage brands including Coca-Cola, Fanta, Sprite and Powerade, the company said. The operations are to be headquartered in Berlin.

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