Coke to buy China multi-grain drinks maker for $400 mln (updated)

China Green (Holdings)

17/04/2015 13:17

(Adds Coca-Cola statement, paragraph 5) 
    HONG KONG, April 17 (Reuters) - Coca-Cola Co  KO.N  has 
agreed to buy the beverage business of China Culiangwang 
Beverages Holdings Ltd  0904.HK  for $400.5 million including 
debt, to get a foothold in the fast growing multi-grain drinks 
category. 
    The deal marks Coke's first takeover in China since the 
country's antitrust regulator blocked its bid to buy local fruit 
juice maker Huiyuan in 2010.  
    Following the disposal of the beverage business, China 
Culiangwang will continue to develop its consumer products 
business, the company said in a stock exchange statement. The 
sale is subject approval from Chinese antitrust approvals. 
    Coke is paying a premium to China Culiangwang's market value 
of $230 million. The company's shares, which have more than 
doubled this year, were suspended ahead of the announcement. 
They will resume trading on Monday. 
    "The proposed acquisition is in line with Coca-Cola China's 
strategy to continue providing a diverse range of beverage 
products to Chinese consumers with plant-based protein drinks 
representing a growing beverage category in China," Coke said in 
a statement. 
    Established in 1998, China Culiangwang, manufactures red 
bean and green drinks and owns and sells "Cu Liang Wang" branded 
beverages and food products.  
    The beverage business earned a net profit after tax of 193 
million yuan ($31 million) for the year to April 2014.  
    It had assets of HK$1.7 billion ($219 million) as of end 
October, 2014. 
    Standard Chartered  STAN.L  acted as the exclusive financial 
advisory to China Culiangwang, the statement said. 
    ($1 = 6.1976 Chinese yuan renminbi) 
    ($1 = 7.7505 Hong Kong dollars) 
 
 (Reporting by Denny Thomas; additional reporting by Ben 
Blanchard in Beijing; editing by Jason Neely) 
 ((denny.thomas@thomsonreuters.com; +852 2843 6358; Reuters 
Messaging: denny.thomas.thomsonreuters.com@reuters.net)) 
 
Keywords: C CULIANGWANG M&A/COCA  COLA