Coca-Cola subsidiary in Turkey plans expansion

Reuters/Temilade Adelaja

• CCI in talks to acquire Coca-Cola Bangladesh Beverages
• CEO says Central Asia and Pakistan reported growth in Q1
• Turkey sales down 8% partly due to February earthquake

The Coca-Cola subsidiary in Turkey is in advanced talks to expand in existing and new markets, with a potential acquisition deal in Bangladesh possible within the next few months.

Coca-Cola İçecek (CCI) is headquartered in Istanbul and operates in Turkey, Pakistan, Kazakhstan, Iraq, Uzbekistan, Azerbaijan, Kyrgyzstan, Jordan, Tajikistan, Turkmenistan and Syria. 

With 30 plants in 11 countries, it produces, distributes and sells branded beverages on behalf of the Atlanta-based drinks giant The Coca-Cola Company, which owns 20.1 percent of CCI.

CCI said in a statement it has been engaged in “advanced stage talks” with The Coca-Cola Company to acquire Coca-Cola Bangladesh Beverages. A deal could be finalised in a few months.

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The statement said CCI is also “pursuing organic growth opportunities” in existing markets, and is in discussions with The Coca-Cola Company regarding additional expansion or acquisition opportunities.

According to its Q1 2023 report, CCI reported a 6.3 percent year-on-year rise in volume during the first three months of this year.

This resulted in a 79.5 percent rise in revenue to 15.6 billion lira ($602.8 billion) and a 64.2 percent rise in net profit to 1 billion lira.

Burak Başarır, CEO of CCI, said in the Q1 report that Central Asia and Pakistan reported double-digit volume growth, which offset the softer volumes in Turkey and the wider Middle East.

Başarır said CCI’s operations in Turkey had seen an 8 percent decline in the first quarter, due to challenges from the earthquake in February which killed 50,000 people and caused $34 billion worth of damage.

The latest Istanbul Chamber of Industry Turkey manufacturing index for May, which was published by S&P Global earlier this month, found that respondents reported a recovery in the sector, as new orders increased and staffing levels rose.

“The gradual recovery of the Turkish manufacturing sector, both from February’s earthquake and the lingering disruption caused by the pandemic, remained on track in May,” Andrew Harker, economics director at S&P Global Market Intelligence, said.

“Helping firms respond to greater new business volumes was a renewed increase in employment as firms were able to make progress on building up workforce numbers.”

CCI is listed on the Turkish stock exchange and its share price has risen from 243 lira on June 20 to a peak of 271 lira today.