Coca Cola to invest $250mn, may buy out bottlers

Coca Cola is pumping in about $250 million to consolidate its bottling operations in India.

Market sources said the fresh funds will be utilised by the company's bottling arm, Hindustan Coca Cola Beverages (HCCB),  for a one-time buy out of excess capacities from its bottlers instead of paying them an assured sum over a period of time as agreed earlier.

The company had, in 2002-03, signed a 10 year co-packing agreement with bottlers for different plants set up in cities including Kanpur, Aurangabad, Orissa and Bareily. Cola Cola is understood to have started parleys with franchise bottlers to buy out plants set up for production of 200 ml bottles.

The decision comes in the wake of the company's shift in strategy as it has chosen not to push for volumes.

"As a matter of principle we do not comment on our future plans, but Coca Cola and its bottlers always look at strengthening business," a Coca Cola India spokesperson said.