The Coca-Cola Amatil (ASX:CCL) share price is on the rise this morning following an update regarding the company’s proposed acquisition.
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What’s driving the Coca-Cola Amatil share price?
The Coca-Cola share price is on the move this morning after the company announced Coca-Cola European Partners PLC (NYSE: CCEP) has increased its offer price to independent shareholders to acquire all Coca-Cola Amatil independent shares.
In an announcement released this morning, it was reported that CCEP has revised the original offer made in its scheme implementation deed on 4 November, upping the cash per Amatil share from $12.75 to $13.50.
CCEP has stated that this 5.9% increase to its original total cash consideration will be its best and final offer to Coca-Cola Amatil’s independent shareholders. CCEP noted that the new proposal also represents a 35% premium to the undisturbed average broker 12-month price target for Amatil shares.
Amatil’s Related Party Committee (RPC) and Group Managing Director Alison Watkins unanimously recommended that shareholders vote to support the new offer, providing no superior offers emerge and subject to the usual conditions being met.
Commenting on the offer, Coca-Cola Amatil Chair Ilana Atlas said:
The economic outlook for Australia and New Zealand has improved since the announcement of the original CCEP proposal and recent trading validates our strategy and demonstrates our strong recovery. The value of Amatil has increased and we are pleased that CCEP has acknowledged this in increasing its proposed cash consideration to Independent Shareholders.
The RPC and the Group Managing Director unanimously consider that the Revised Scheme, including the revised price, is in the best interests of Independent Shareholders.
Coca-Cola Amatil is the authorised bottler and distributor of The Coca-Cola Company’s beverages in Australia and five other Asia Pacific regions. The company has a market capitalisation of around $9.5 billion and pays an annualised dividend yield of 2.7%, unfranked.
The Coca-Cola share price moved sharply higher following the original takeover offer from CCEP in October and shares have continued to slowly trend higher since then. Over the past six months, Coca-Cola Amatil shares are up 51%. That compares to a 13% gain on the S&P/ASX 200 Index (ASX: XJO).
Since this time last year, the Coca-Cola Amatil share price is up 13% compared to a 4% fall on the ASX 200.
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Motley Fool contributor Bernd Struben has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.