Coca Cola is pumping in about $250 million to consolidate its bottling operations in India. Market sources said among others, the fresh funds will be utilised by the company's bottling arm Hindustan Coca Cola Beverages 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 upon earlier.
In 2002-03, the company signed a 10 year co-packing agreement with bottlers for different plants set up across the country, including Kanpur, Aurangabad, Orissa, Balla and Bareily.
Coke is understood to have started parleys with franchise bottlers to buy out plants set up for production of 200 ml bottle. The decision to buy out excess capacities comes in the wake of the company's shift in strategy as it has chosen not to push for volumes.
A Coca Cola India spokesperson said, "As a matter of principle we do not comment on our future plans but Coca Cola and its bottlers are always looking at strengthening our business."
The sources, however, said HCCB is looking at utilising its own idle capacities and if need be set up fresh units for new products.
Coca Cola is looking at restructuring its marketing and distribution network, which would entail adding an additional 1,000 sales force across the country for better efficiency levels.
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