The Coca-Cola Company on Saturday announced the reshaping of its bottling operations in China.
The announcement was made jointly with an agreement of the Coca-Cola Company and its Bottling Investments Group China, COFCO Coca-Cola Beverages Limited (a subsidiary of COFCO Corporation), and Swire Beverage Holdings Limited.
As a result, Coca-Cola's bottling operations in China will be concentrated in its two franchise partners, COFCO and Swire. COFCO will own and operate 18 bottling plants, while Swire will own and operate 17.
"Today's announcement marks our refocus on core strengths of building great brands and leading a strong, global franchise system," said Muhtar Kent, Chairman and CEO of the Coca-Cola Company.
By refranchising all company-owned bottling operations in China to local partners, Coca-Cola aims to position these companies to leverage greater scale, capability and efficiency throughout China to invest for growth.
"I think it is the transformation of the company because we are going back to the core of our business which is strategy and brands," Kent said.
"We remain excited about our long-term growth prospects in China," Kent said, promising that the company will invest continuously in the world's second-largest economy.
"China's long and stable economic growth provides great opportunity for sustainable development of the beverages industry," said Zhao Shuanglian, Chairman of COFCO Corporation.
"The scale effect, regional synergy and cost optimization that the new initiative brings will certainly boost Coca-Cola and its partners to achieve a new leap forward in China," Zhao added.