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Arca Continental starts operations in US

Published 04 April 2017

Arca Continental, the second-largest Coca-Cola bottler in Latin America, has started its operations in the US.

As per the bottling territories refranchising policy for North America, Arca Continental agreed to act as Coca-Cola’s sole franchise bottler in Southwest US.

The states that will come under the deal include Texas, parts of Oklahoma, New Mexico and Arkansas. A total of nine production facilities were involved in the deal.

Arca carried out with the deal by contributing the shares of its beverage business operating in Mexico, Argentina, Peru and Ecuador to its subsidiary AC Bebidas.

On other hand, Coca-Cola Refreshments USA (CCR) also contributed 100% of the equity of Coca-Cola Southwest Beverages.

Coca-Cola Southwest Beverages has the exclusive rights to bottle, distribute and sell within the southwest region of US, with estimated sales of $2.35bn, annually.

As a result, from now on, Arca Continental will hold 80% equity stake in AC Bebidas and Coca-Cola Refreshments USA will hold the remaining 20%.

For the deal, all the necessary closing conditions have been met and approvals have been received from the respective regulatory authorities, Arca Continental stated. Operations at Arca Continental’s new territory in the Southwest US have started recently.

Recently, Arca Continental and other bottlers such as Coca-Cola FEMSA, Embotelladora Andina, Embonor, Corporacion Del Fuerte, Corporacion Rica, Bepensa, Embotelladora del Nayar, Embotelladora de Colima, Solar, Brasal, Bandeirantes, Sorocaba, Simoes, Uberlandia, CVI, Lee, and Monresa participated in Coca-Cola’s acquisition of the Argentinean soy-drinks brand AdeS from Unilever.

This February, Arca reported growth in revenue of 22.5% and earnings before interest, tax, depreciation and amortization (EBITDA) was up by 20.3% for 2016.

Image: Arca Continental to start operations in Southwest US. Photo: Courtesy of Arca Continental S.A.B. de C.V.