By Mike Cherney
SYDNEY--Coca-Cola European Partners PLC, a major Coke bottler in Europe, increased its takeover offer for Australian bottler Coca-Cola Amatil Ltd., following an improved outlook for Australia and New Zealand since the deal was first announced.
The European bottler is now offering 13.50 Australian dollars (US$10.48) per share for Amatil stock held by independent shareholders, up from A$12.75 per share offered last year. A separate agreement for the European bottler to acquire other Amatil shares from U.S.-based Coca-Cola Co., which owns a 31% stake, is unchanged.
The new offer values Amatil at roughly A$9.8 billion and is a 5.9% increase over the initial offer price. Amatil said he new price is a 30% premium on the one-week volume weighted average price of Amatil as of Oct. 22, the last day of trade prior to the first announcement of the deal.
Amatil said it is recommending that shareholders vote in favor of the deal. It said the offer is the European bottler's best and final offer.
"The economic outlook for Australia and New Zealand has improved since the announcement of the original CCEP proposal and recent trading validates our strategy and demonstrates our strong recovery," said Amatil Chairman Ilana Atlas. "The value of Amatil has increased and we are pleased that CCEP has acknowledged this in increasing its proposed cash consideration to independent shareholders."
Coca-Cola Amatil had faced many of the same challenges as bottlers in other markets. Consumers in Australia, its largest market by revenue, have shifted away from sugary, carbonated beverages due to health concerns, hitting revenue despite the company's efforts to diversify into coffee, energy drinks and alcohol distribution. More recently, sales were hit by the coronavirus pandemic.
For U.S.-based Coke, its agreement to sell its stake in Amatil is its latest move to reduce exposure to costly bottling operations and focus on the more lucrative concentrate-making business.
Write to Mike Cherney at email@example.com
(END) Dow Jones Newswires