Coca-Cola India has begun exploring the process of divesting its asset-heavy bottling partner Hindustan Coca-Cola Beverages’ plants in line with its global strategy to re-franchise bottling across markets.
The beverage maker has initiated talks with its existing independent franchise bottlers for the divestment, two officials with direct knowledge of the development said. The sell-off transactions, as and when they materialize, are expected to happen in phases to existing independent bottling partners individually, and over the long term.
The objective is to move away from the capital intensive, low margin business of bottling over a period of time, to accelerate focus on its concentrate business. The company-owned HCCB has 18 plants and accounts for two-thirds of Coca-Cola India’s volumes.