Coca-Cola closing Nidan factories, consolidating juice business at Multon
MOSCOW/NOVOSIBIRSK. May 8 (Interfax) - American Coca-Cola Co. has decided to close the factories of LLC Nidan Juices and consolidate its juice business in CJSC Multon, a representative from Coca-Cola's Russian division, Vladimir Kravtsov, told Interfax.
The Nidan plants in the Moscow and Novosibirsk regions will be shut down starting June 1, he said. This is due to the company's plans to consolidate its juice assets at Multon. Specifically, the production of Nidan's most successful brand, Moya Semya, will be transferred to Multon, which owns factories in Shchyolkovo near Moscow and in St. Petersburg with overall capacity of 790 million liters per year.
Multon will begin producing juices in Novosibirsk in the second half of 2014, Coca-Cola Hellenic Bottling Company, Coca-Cola's bottling company in Russia, told Interfax. The Novosibirsk plant currently produces the nonalcoholic beverages Coca-Cola, Coca-Cola Light, Sprite, Fanta and Schweppes.
The company said it would present its new production lines in late May, but did not state the value of the project, the capacity of the new lines, or the brand of juices around which production was to be organized.
The Ministry of Industry, Trade and Business Development of the Novosibirsk region told Interfax that two production lines for Dobry juices had been set up at the Coca-Cola HBC plant in Novosibirsk.
Multon produces juices under the Dobry and Rich brands, which showed good results on a falling market last year. The company was able to boost its sales and market share in 2013, Coca-Cola said.
It has not yet been decided what will happen to Nidan's brands Caprice, Da!, or Sokos, which are all shadowed by Moya Semya in terms of sales volume and market share. The company has also not yet decided what to do with the discontinued factories. If an entity is interested in buying the production facilities, Coca-Cola might consider the deal, though it is still premature to talk about this, a company representative said.
Last year Coca-Cola made the decision to reorganize Nidan Juices by merging four other companies with it: LLC Gross, LLC Nidan Gross, LLC Kvint-M and LLC JV Nidan-Ekofruit. According to the SPARK-Interfax database, Nidan Juices increased revenue 0.8% in 2012 to 7.65 billion rubles from 7.59 billion rubles in 2011. Net profit fell to 944.3 million rubles from 2.3 billion rubles.
Multon saw revenue increase 21.3% in 2012 to 18.9 billion rubles from 15.6 billion rubles in 2011. Net loss fell to 608 million rubles from 1.25 billion rubles.
According to the Russian Union of Juice Producers (RSPS), juice's sales volume in Russia totaled 3.3 billion liters in 2012, up 2.3% from 2011. The industry's largest companies accounted for 64% of this. PepsiCo's share exceeded 40%, of which 21% was from Lebedyansky and 19% - Wimm-Bill-Dann Foods. The second largest player was Coca-Cola with a share of 24%; Multon accounted for 17% and Nidan Juices - 7% in 2012. The company Sady Pridonya follows PepsiCo and Coca-Cola with 9%.
In the spring of 2005, Coca-Cola Company and Coca-Cola HBC acquired Russian juice company Multon for over $500 million and in the summer of 2007 Coca-Cola HBC bought soft drinks manufacturer Aqua Vision for 191.5 million euro. Coca-Cola bought one of the largest juice manufactures in Russia - OJSC Nidan Juices in 2010 for $276 million. The American company currently owns 14 factories in Russia.
