Coca-Cola, Bhartiya family likely to consider listing HCCB in India

Coca-Cola and the Bhartiya family may look to list Hindustan Coca-Cola Beverages (HCCB) in India, with the Bhartiya family set to become the controlling shareholder

American beverage maker Coca-Cola Company and its local partner, the Bhartia family, may look at listing Hindustan Coca-Cola Beverages (HCCB) in India, and the overseas entity’s stake in the bottling company will come down below the majority level over five years, according to a source in the know.

 

The source said in accordance with the plan, the Bhartia family would become the reference and controlling shareholder in the business.

 

“They (the family) are not a passive financial investor or a passive strategic investor and that’s not what Coca-Cola was looking for here,” the source said.

 

On HCCB’s listing, the source added: “There’s been no explicit, if you like, confirmation of an IPO, but that’s a possibility.”

 

In December last year, the Bhartia family’s Jubilant group, through Jubilant Beverages, had announced that it would acquire a 40 per cent stake in Hindustan Coca Cola Holdings, the parent of the bottling company, at a valuation of ₹12,000 crore. While as of today Coca Cola still remains the majority shareholder, the Atlanta-based major’s strategy is to refranchise its bottling operations globally as part of its asset-light model across the world.

 

Rothschild & Co advised Coca-Cola on this transaction, which concluded this month. 

 

“We started the process of reaching out to a number of Indian families, partners that we thought would be fit as purpose partners in late 2023 and we conducted a competitive process. In September last year we entered into an exclusive dialogue with the Bhartia family and that led to the signing of the transaction,” Akeel Sachak, partner and global head of consumer, Rothschild & Co, said at a round table.

 

He added that one of the things that distinguished the Bhartia family from other suitors was their success as a franchise of major American brand Dominos.

 

On trends in the consumer space, multiple Indian industrial houses and conglomerates want to play in the sector, said Subhakanta Bal, managing director, Rothschild & Co India.

 

“The recent paints transaction (JSW acquired AkzoNoble’s India business), or some of the largest families that have deployed significant capital in essentially what are new sectors or sunrise sectors (are pointers to that),” Bal added.