Unilever, Coca-Cola Strike Soy Drinks Deal -- Update
June 01 2016 - 10:47AM
Dow Jones News
By Saabira Chaudhuri
Unilever PLC has struck a deal with Coca-Cola Co. and soft-drink
bottler Coca-Cola Femsa SAB to sell its soy beverage business in
Latin America for $575 million as the Anglo-Dutch company continues
to shuffle its portfolio of brands.
The beverage business, called AdeS, sells drinks that are a
combination of soy milk and fruit juice. It has a presence in
Brazil, Mexico, Argentina, Uruguay, Paraguay, Bolivia, Chile, and
Colombia. Last year it turned net revenues of $284 million.
"This sale is a step in reshaping our portfolio in Latin America
to deliver sustainable growth for Unilever and enables us to
sharpen our focus, said Miguel Kozuszok, Executive Vice President
of Latin America for Unilever.
Unilever has been shedding food brands in recent years and
making acquisitions in the higher-margin, personal-care sector
under Chief Executive Paul Polman, a strategy analysts have said
gives it stronger growth prospects.
The company in 2014 agreed to sell its North American pasta
sauces business under the Ragú and Bertolli brands to Japan's
Mizkan Group for $2.15 billion. Before that, Unilever sold its
Wish-Bone salad dressing to Pinnacle Foods Inc. for $580 million
and Skippy peanut butter to Hormel Foods Corp. for $700
million.
The sale comes as Coca-Cola has been diversifying its portfolio
in response to slowing soda sales as customers become more health
conscious. The Atlanta-based beverage giant has been targeting
emerging markets for growth amid sluggish sales in more-developed
markets.
In January, Coca-Cola said it had agreed to buy part of
Nigeria's largest juice maker, TGI Group's Chi Ltd., which also
sells dairy and snacks, and would buy the rest of the company
within three years. In August, Coke said it was buying a minority
stake in Suja Life LLC, which makes organic, cold-pressed
juices.
"The acquisition of AdeS marks another milestone for the
Coca-Cola system in providing increased choice of nutritious and
delicious products to our consumers," said Brian Smith, Latin
America president for Coca-Cola.
Write to Saabira Chaudhuri at saabira.chaudhuri@wsj.com
(END) Dow Jones Newswires
June 01, 2016 10:32 ET (14:32 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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