Coca-Cola to end IPO dry spell with US$8 billion Africa bottler listing

By Seth ONYANGO

Coca-Cola Co. is advancing plans for a significant initial public offering of its African bottling arm as soon as 2025, with a valuation that could exceed US$8 billion.

This major financial move is set to end a period of sluggish activity on African securities exchanges and would be a significant morale boost for the continent’s stock market landscape.

According to insiders, the beverage giant is again eyeing a dual listing in Johannesburg and Amsterdam, after shelving these plans in 2022.

Experts believe that this move by Coca-Cola could spearhead a series of similar high-value listings by Africa-focused companies, breaking an IPO ‘drought’ and revitalising market interest.

Among the companies preparing for such transitions is Flutterwave, a leading African fintech firm now valued at US$3 billion, which is laying the groundwork for its IPO.

Flutterwave is enhancing its organisational structure and regulatory compliance to ensure a robust debut, potentially on NASDAQ in 2024. This parallels the efforts seen in Coca-Cola’s strategic push and could mark a broader trend of significant IPO activities across the continent post-pandemic era.

While the African IPO scene has been relatively quiet, some notable listings hint at growing market readiness.

In 2022, Orange Côte d’Ivoire and Geregu Power Nigeria successfully launched public offerings, underscoring the market’s capacity for significant capital-raising efforts

That same year, the Egyptian Exchange (EGX) welcomed the Macro Group for Pharmaceuticals Company after its IPO, marking the second listing of the year following Al Khair River for Development and Investment.

Additionally, the listing of Revitus Property Opportunities Real Estate Investment Trust Fund in late 2023 further demonstrated the market’s ongoing potential to support substantial financial initiatives.

Coca-Cola Beverages Africa is the eighth-largest Coca-Cola bottler worldwide by revenue and the biggest in Africa, serving about 40% of all Coca-Cola volumes sold on the continent.

It operates in around 15 countries including Ethiopia, Namibia, Kenya, South Africa, Comoros and Tanzania, employing more than 18,000 people, which makes it a cornerstone of the beverage giant’s operations in emerging markets.

Coca-Cola holds a majority 66.5% stake in its bottling unit, with the remaining 33.5% owned by Gutsche Family Investments.

The IPO details are still being discussed and could evolve, highlighting Coca-Cola’s cautious approach in timing its market entry to capture favourable conditions.

The anticipated listing comes at a time when global economic shifts have cast new light on emerging markets, with Africa positioned as a potentially lucrative region for international investments.