someone asked if TCCC can cancel the bottlers agreement. The agreements are revewed every 10 years but can be cancelled if either party fails to comply with bottler requirements.They may also terminate the agreement under clauses such as the bottler not accepting prices proposed.
Reading through the terms, I would struggle to see why TCCC would cancel their agreement in any country excluding a slim possibility for Indonesia. They would absorb 30% of the loss that CCA incur as 30% owners. Further to this, they would need to establish distribution agreements for all their existing product lines. It is extremely difficult to establish that much bottling capacity in such a short term time frame.
The only place I could see TCCC cancelling their agreement is indonesia where it may be feasible to cancel the agreement if TCCC could team up with one of the large competitors (big cola), thus creating a monopoly.
CCL Price at posting:
$8.63 Sentiment: Buy Disclosure: Held
