Business

Wednesday July 1, 2009

F&N, Coca-Cola extend agreement


PETALING JAYA: Fraser & Neave Holdings Bhd (F&N) has signed a transition agreement with The Coca-Cola Co to sell Coca-Cola and Sprite soft drinks in Malaysia for a further 20 months.

F&N yesterday announced that the new agreement would take effect from the expiry of its existing bottling and distribution agreement on Jan 26, 2010, for another 20 months until Sept 30, 2011, “with some modification terms.”

Under the terms of the agreement, F&N would also be entitled to launch new brands or categories (except cola and lemon-lime carbonated soft drinks) from Jan 27, 2010 for both domestic and export markets.

In a separate statement, Coca-Cola said it would continue to bottle, distribute and sell brands from F&N for the markets in Singapore and Brunei over the same period.

“The transition agreements, which will run for 20 months, will allow Coca-Cola and F&N to independently pursue opportunities in categories other than sparkling fruit-flavoured drinks & isotonic drinks, and sparkling beverages (cola and lemon), respectively, in Malaysia, Singapore and Brunei.

“It is currently not the intention to renew these transition agreements when they expire on Sept 30, 2011,” the company said.

F&N said in February that Coca-Cola Co was not extending the bottling and distribution agreement with F&N when it expired on Jan 26, 2010.

Sales revenue of Coca-Cola Co products, mainly Coca-Cola and Sprite, amounted to RM421mil, or 35% of F&N’s soft drinks division’s revenue for its financial year ended Sept 30, 2008.


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