The head of soon-to-be-acquired Coca-Cola Amatil is confident the company’s new European owners will maintain a significant level of investment in local manufacturing as shareholders prepare to sign off on the $10 billion takeover.
Alison Watkins, Amatil’s longstanding chief executive, told The Age and The Sydney Morning Herald she didn’t envision Cogca-Cola European Partners (CCEP) moving any of Amatil’s operations offshore, noting now was a prime time to be investing in local manufacturing.
Alison Watkins, Coca-Cola Amatil’s chief executive officer, has said Australia should put more focus on premium manufacturing.Credit:Louie Douvis
“The nature of our manufacturing business in each market is a very local one, and the nature of beverages is that it doesn’t make sense to transport them too far,” she said. “And I think CCEP understand and respect that.
“COVID has certainly heightened our awareness of how reliant we are on global supply chains and the importance of supporting local businesses.”
Australia’s local manufacturing sector has been “hollowed out” in recent years due to a lack of investment and heightened global competition, but Ms Watkins believes there’s ample opportunity to have high-quality products made on Australian shores.
“Over the past few decades, it’s been more difficult for a lot of manufacturing businesses to compete,” she said. “But I think if we really focus on more premium and advanced manufacturing, rather than the sort of pure commodity type manufacturing, there’s a really important role that Australia can play.”
Ms Watkins’ comments come on the eve of Amatil’s Friday virtual meeting where the company’s independent shareholders will vote on a $13.50 a share takeover bid from CCEP, which first lobbed its offer back in late October.
Investors are expected to overwhelmingly vote in favour of the $9.8 billion offer after CCEP agreed to raise its offer price by 75 cents in late February following pressure from shareholders and analysts who said the original $12.75 a share bid undervalued the business.
Major proxy advisory firms Glass Lewis and ISS have both advised shareholders to vote in favour of the scheme, with the latter labelling the deal “compelling and attractive”.
Ms Watkins joined Amatil at a difficult time for the business and has overseen significant work to strengthen and improve the company, including a major turnaround of its New Zealand operations. She said she was feeling “nostalgic” ahead of tomorrow’s vote, acknowledging that Amatil as she knows it will no longer exist.
CCEP’s deal is likely to lock in shareholder approval after the company raised its offer for Coca-Cola Amatil.Credit:Bloomberg
“It’s certainly a momentous occasion. We all feel a little bit nostalgic to know that Amatil won’t be continuing as the wonderful independent organisation it’s been. But I think we also feel equally very excited about the next chapter.”
Currently, Ms Atkins is focused on the formalities of finishing off tomorrow’s vote, after which she’ll stay with Amatil to ensure the integration between the two businesses is successful. Only after that will she look to “what lies ahead”, she said.
“I know that the business will have a strong future under CCEP’s ownership. And it’s a really satisfying way to be handing it over.”
Dominic Powell writes about the retail industry for the Sydney Morning Herald and The Age.
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