Greek Coke in £43m bid for Lanitis

THE WORLD’S second-largest bottler of Coca Cola products, Greece’s CCHBC, said yesterday it would offer to buy Cyprus bottler Lanitis for around $90 million, to expand further into non-carbonated soft drinks.

Coca Cola Hellenic Bottling Co. (CCHBC) said it would submit the public offer through its subsidiary 3E (Cyprus) Limited for up to 100 per cent of Lanitis Brothers Ltd., in what analysts called a small but sensible acquisition.

Vladimiros Lanitis, who holds 50.6 per cent of the issued share capital of Lanitis, has agreed and committed to accept the offer, said CCHBC, which is 24 per cent owned by US soft drinks giant Coca Cola Co.

“In view of this commitment, Three Epsilon (3E) Cyprus intends to purchase the rest of the shares tendered through the public offer,” it added.

CCHBC is offering 0.172 pounds in cash for each Lanitis share. The current number of shares in Lanitis is 250 million, putting a value of £43 million on the offer.

The company said that Lanitis, which also has the Coca Cola bottling franchise in Cyprus and a range of fruit juices and dairy products, provides a natural geographic fit.

“We anticipate operational synergies and benefits to arise from a two-way sharing of expertise,” said CCHBC managing director Doros Constantinou.

Analysts said the Cyprus deal fitted with CCHBC’s plans to expand geographically and diversify into non-carbonated soft drinks.

CCHBC, with operations in 26 countries, has recently made a series of acquisitions in the non-carbonated soft drink (non-CSD) segment in eastern Europe.

Deutsche Bank raised its price target for CCHBC to 26 euros from 25 euros on the news, maintaining its “buy” recommendation.

“We would expect margin improvement via procurement synergies, fixed asset efficiencies and potentially cross-selling of brands,” Deutsche Bank said in its note. “Overall a small but sensible, bolt-on acquisition.”

“Lanitis will also take CCHBC into the milk market, which we believe is an area CCHBC would like to explore,” it added.

CCHBC shares were almost flat at 24.22 euros at 1225 GMT, while the general index was up 0.75 per cent.

Lanitis shares, which were suspended last Friday, resumed trading on the Cyprus bourse earlier yesterday and were 0.016 per cent firmer at 0.167 pounds.
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The Cyprus Mail is the only English-language daily newspaper published in Cyprus. It was established in 1945 and today, with its popular and widely-read website, the Cyprus Mail is among the most trusted news sites in Cyprus. The newspaper is not affiliated with any political parties and has always striven to maintain its independence. Over the past 70-plus years, the Cyprus Mail, with a small dedicated team, has covered momentous events in Cyprus’ modern history, chronicling the last gasps of British colonial rule, Cyprus’ truncated independence, the coup and Turkish invasion, and the decades of negotiations to stitch the divided island back together, plus a myriad of scandals, murders, and human interests stories that capture the island and its -people. Observers describe it as politically conservative.