‘Sleeping giant’ dumps Coke, creates $3b Aussie drinks group

afr.com:

Japanese giant Suntory will merge its two drinks businesses in Australasia to create a $3 billion-a-year company that will see alcohol brands including Jim Beam and the No.2 ready-to-drink spirits brand -196 brought under the same roof as non-alcohol products.

The non-alcohol brands include Australia’s biggest selling energy drink, V Energy, which is outpacing fierce rival Red Bull. It also sells Maximus and Boss Coffee.

Beam Suntory managing director Mark Hill (left) and Frucor Suntory CEO Darren Fullerton. 

The new Suntory Oceania entity will be up and running by mid-2025, and means Coca-Cola Europacific Partners will hand back a contract after 16 years of Coca-Cola entities operating the local manufacturing, sales and distribution of the Suntory Beam alcohol brands.

Coca-Cola Amatil, the former ASX-listed Coca-Cola bottler in Australia which previously held the rights since 2009, was swallowed by Coca-Cola Europacific Partners in a $9.8 billion buyout in 2021.

Darren Fullerton, chief executive of Frucor Suntory, said the non-alcohol business had generated sales growth of 10 per cent-plus in calendar 2022 and sales continued to be solid. The alcohol brands had also been generating good growth of high single digits. “Both of these businesses are in significant growth,” he said.

Suntory has started building a $400 million manufacturing and distribution facility at Ipswich in Queensland on a 17ha site which will have an initial production capacity of 20 million cases of ready-to-drink products annually. It will give extra impetus to Suntory’s growth plans. There is also a production site in Auckland.

“It’s been a bit of a sleeping giant in this part of the world,” Mr Fullerton said.

Suntory had been weighing up its