Australia: CocaCola Amatil sell SPC

The beverage company’s decision to sell SPC comes four years after the Victorian government and Coca-Cola Amatil co-invested AUD100 million (AUD 78 and AUD 22 million respectively) to help the struggling business.
Coca-Cola Amatil initiated a strategic review into SPC in August. The company’s group managing director, Alison Watkins, said that while there were no plans to close SPC, the review had concluded that selling the Shepparton-based firm would provide the best means of enabling it to grow in the future. 

 Watkins said that while SPC production would for now continue as normal at Shepparton and Kyabram, Coca-Cola Amatil would develop a divestment timeline and process over the coming months.
Watkins also indicated that Coca Cola Amatil has decided that the IXL and Taylor’s brands will remain with SPC following the announcement on 21 November that an expected sale to Kyabram Conserves will no longer proceed (*).

Coca Cola Amatil has invested approximately AUD 250 million into SPC since acquiring it in 2005, including in new tomato and high-speed snack lines, a new aseptic fruit processing system and new export opportunities including in China.

Watkins said that Coca-Cola Amatil expects its 2017-18 full-year results will weighed down by AUD 50 million in expenses due to “cost optimisation programs” and that the company would possibly be unable to meet earnings growth target in the 2018-19 financial year due to factors that include the impacts of container deposit schemes in Australia, higher PET resin costs and a weak Indonesian rupiah.

Watkins said that SPC’s AUD 10 million loss was “modest” and “not a big deal” in the  long-run.

(*): (See also our article (28/11/2018) http://www.tomatonews.com/en/spc-ardmona–sales-of-assets-cancelled_2_557.html)

Source: foodmag.com.au, canberratimes.com.aul, foodprocessing.com.au