Coca-Cola to finish refranchising US bottling territory by year end

Coca-Cola has said that it ‘remains on track’ to complete the refranchising of its US bottling operation by the end of the year.

The soft drinks giant has agreed a deal for Liberty Coca-Cola Beverages – a new venture between former Coca-Cola Refreshments executives Paul Mulligan and Fran McGorry – to take over the bottling of its products in ‘a significant area’ of northeastern US.

The territory include metropolitan New York, Philadelphia, most of the state of New Jersey and part of Delaware, plus four production facilities, Coke said.

It has been refranchising company-owned bottling territory for several years and, in February 2016, said that it would redouble its efforts to divest the remaining regions still under its ownership.

The plans included the sale of 39 cold-fill production facilities, which produce sparkling beverage brands such as Coca-Cola and Sprite as well as still ranges like Dasani.

Coca-Cola’s refranchising timeline

June 2015 – Finalises agreements with bottlers in Florida, Chicago and Indiana
February 2016 – Reaffirms commitment to refranchising all company-owned territory
February 2016 – Agrees to sell additional bottling territory to Swire Coca-Cola
July 2016 – Refranchises two more territories in North Carolina and the Pacific Northwest
October 2016 – Announces changes to a refranchising plan agreed earlier in the year

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That target now seems infinitely closer, with Coca-Cola saying it expects to close on the remaining refranchising initiatives in the second half of this year.

Coca-Cola North America president Sandy Douglas Jr said: “This is a critical milestone in a journey that dates back more than a decade. This important bottling territory will be in great hands under the leadership of Paul and Fran. They are experienced, locally respected operators who see many growth opportunities in the Tri-State market.”

Mulligan called it ‘an honour and a privilege’ to become a Coca-Cola franchise owner, saying that there was ‘a responsibility and challenge we respect’.

“I have been part of the Coca-Cola family for 30 years, and we see this as a great opportunity to accelerate the business while being an integral part of the local community,” McGorry added.