Soft drinks giant Coca-Cola Europacific Partners is quitting an Australian beer joint venture after eight years, selling its stake in the Australian Beer Co business to long-time partner Casella Family Brands, which is best-known for its big-selling Yellow Tail wine brand in the United States.
The decision to sell the stake in the brewing business based at Yenda in NSW continues a repositioning for the Coca-Cola business in Australia following a $9.8 billion buyout of the ASX-listed Coca-Cola Amatil in April last year.
Coca-Cola Amatil stopped trading on the ASX after 51 years, and Coca-Cola Europe changed its name to Coca-Cola Europacific Partners after that deal.
Coca-Cola Europacific Partners put a separate craft beer business, Feral Brewing Co, up for sale in late October as part of a shift out of beer, to concentrate on its core soft drinks range, coffee, spirits and ready-to-drink alcohol. It bought Feral Brewing Co in 2017.
Coca-Cola Europacific Partners vice-president and general manager for Australia, Pacific & Indonesia, Peter West, said on Tuesday the decision to sell its interest in Australian Beer Co stemmed from a strategic review of the group’s overall operations last year.
“The launch of the Australian Beer Co joint venture in 2013 was our re-entry into the beer market in Australia,” Mr West said.
The Australian Beer Co business brews its own brands at the brewery next door to the Casella winery in Yenda, near Griffith in NSW.
“With CCEP’s exit from the Australian beer and apple cider categories in Australia, the decision to sell our interest in ABCo was the natural next step,” he said.
Diversification strategy
Mr West said the group exited the joint venture on good terms with the Casella family.
Casella Family Brands managing director John Casella said his company would endeavour to maintain the excellent relationships the CCEP team had established with customers in the beer and cider category in Australia.
The Casella business, formally known as Casella Family Brands, bought a series of higher-end premium wine brands in the past five years in a diversification strategy to reduce its reliance on the Yellow Tail brand.
Yellow Tail was a huge success in the United States after it was launched in 2000, using a distinctive label with a stylised wallaby. It became the single-biggest wine brand imported into the US.
Casella bought Peter Lehmann Wines in late 2014 for $57 million to gain a presence in the premium wine region of the Barossa Valley, and in 2015 acquired Brands Laira in the prestigious Coonawarra district in south-eastern South Australia.
It then bought the Morris Wines range of fortified wine brands from Victoria’s Rutherglen district in July 2016, and South Australian winery Shaw Family Vintners in 2017.
After the $9.8 billion takeover of Coca-Cola Amatil, Coca-Cola Europacific Partners took over the bottling of brands including Coca-Cola, Fanta, Sprite and Monster, Mount Franklin water, Kirks and Cascade, Neverfail and Peats Ridge, Grinders Coffee, NutriBoost and Barista Bros.
Extracted from AFR