Coca-cola Acquisitions, Mergers, and International Strategies and AMC Expansion Ventures

Merger, Acquisition, and International Strategies
Student Name
Professor Name
Course Title
Date
Introduction
The unbalanced business environment has made it inevitable for companies to attain a sustainable competitive advantage and successfully compete in an international scale without implementing expansion strategies. The paper analyzes the Coca-Cola Company and the AMC Entertainment Inc. It analyzes the Coca-Cola acquisitions, mergers, and international strategies and examines feasible strategies and expansion ventures for AMC (Coca-Cola, 2016).
The Coca-Cola Company is an American beverage corporation, established in the year 1886 by Asa Griggs Candler. The company based in Atlanta, Georgia adopted franchised distribution method, where the company produced syrup concentrate and sold it to several bottlers’ companies throughout the world. Besides the company’s flagship brand Coca-Cola, the company produces more than 450 beverage brands, such as Sprite, Diet Coke, and Fanta. Furthermore, the company owns and markets beverage brands including sparkling drinks, juice drinks, energy and sports drinks, and ready to drink teas and coffees. The Coca-Cola Company has fruitfully utilized mergers and acquisitions in expanding its brands to international market (Coca-Cola, 2016).
The company acquired the Minute Maid Company in 1960, the Indian cola product Thums Up in the year 1993 and Fuze Beverage in 2007. The Coca-Cola Company purchased ZICO Beverage, which produces coconut water, in 2013. The company acquired 40 percent stake in Chi Ltd, a Nigeria based company that produce dairy and juice beverages. Moreover, Coca-Cola intends to increase its stake to 100 percent within the next three years after regulatory approvals. In addition, in the year 2015, the company acquired a minority stake from Suja Life LLC that manufactures frozen pressed juice. The Coca-Cola Company has also pursued several mergers in order to promote its brands to the global markets. The Coca-Cola Company, SABMiller, and Gutsche Family Investment agreed to merge the bottling operations of their non-alcoholic ready to drink beverages businesses in East and Southern Africa. Furthermore, the merger of Coca-Cola Enterprises (CCE), Coca-Cola Iberian Partners (CIP), and Coca-Cola Erfrischungsgetränke AG (CCEG) into a new Western European bottler created the world’s major independent Coca-Cola bottler. The Coca-Cola European Partners would serve more 250 million consumers across 12 countries in Western Europe (Coca-Cola enterprises, 2015).
AMC Entertainment Inc is an American company that own and operates a chain of movie theaters. AMC is regarded as the leader in the entertainment industry and a classical destination for moviegoers. The company has more than 380 movie theaters and 5334 screens that serve over 200 million guests a year. The movie theaters are equipped with superior amenities, such as plush, power, recliners, and MacGuffins full bars. Moreover, the AMC dine-in theaters and quality presentation formats including Dolby Cinema at AMC and IMAX offer guests an exciting movie-going experience. AMC recorded profit of $23.97 millions, revenue of $763.96 million in 2016 financial year (AMC Theaters, 2016).
Analysis of the Coca-Cola Company mergers and acquisitions
The Coca-Cola Company seeks to expand its global presence and customer base through acquisitions and mergers. Coca-Cola acquired a stake in Chi Ltd that boasts of attaining a leading position in the production of dairy and juice products in the Nigerian market. Therefore, Coca-Cola obtained the advantage of increasing its product portfolio and establishing its presence in the Nigerian market through a well-known player in the region. Product diversification and international expansion are the key strategies utilized by Coca-Cola in this strategic investment. The product diversification strategy has enabled Coca-Cola to add new products to its product portfolio. Conversely, the international expansion strategy has helped Coca-cola to increase its global market and promotion of its brands (Coca-Cola enterprises, 2015).
The Chi Limited capitalized on the ban of imported juices in Nigeria and built strong image for its brand. Chi Ltd was ranked as the leading company in the juice industry in 2014. Hence, the Coca-Cola Company would take advantage of Chi Ltd dominance by leveraging its brand popularity, and therefore reinforcing its position in the region. The option of Coca-Cola to acquire Chi Ltd was a wise decision because the acquisition enabled Coca-Cola to increase its product portfolio and global market. Furthermore, as the growth in the carbonated soft drinks, market falls and consumer’s preference change towards healthier beverages, the acquisition offer Coca-Cola an opportunity to diversify its portfolio and develop a strong presence in other beverages (Coca-Cola enterprises, 2015).
The Coca-Cola Company acquisition of Minute Maid Company in 1960 marked its initial venture outside of soft drinks. Minute Maid was the foremost company to market and distribute orange juice concentrate across the United States. The acquisition of Minute Maid has played a significant role in success of Coca-Cola. The company is recognized for sparkling beverages; however, the non-alcoholic ready to drink beverages, including Minute Maid orange juice, Minute Maid pure squeezed orange juice, and Minute Maid juices have aided Coca-cola to gain strength and market dominance in several countries. Coca-cola attributes their successful entry to the sub-continent markets, such as China to Minute Maid products. The introduction of pulpy orange by Coca-Cola in China was a huge success and it became the leading juice drink brand across all regions of China (Coca-Cola enterprises, 2015).
As part of Coca-Cola differentiation strategy, it seeks to develop products that provide distinctive attributes that are valued by customers and that customers perceive them to be better and different from products of competitors. Hence, acquisition of Minute Maid matches well with the company strategic direction. The company has diversified Minute Maid brand into various juice drinks including Minute Maid juices and Minute Maid orange juice that have catered the needs of diverse global markets (Coca-Cola, 2016).
Thums Up is an Indian based brand of cola. It was launched in 1977 after Coca-cola deserted operations in India after being compelled to sell 60 percent of its stake to an Indian company. Thums Up enjoyed stronger market share after exit of Coca-Cola until in 1990 when the Indian government opened the market to international companies. Pepsi was the initial company to enter the Indian market followed by Coca-Cola in 1993. The Coca-Cola Company acquired Thums Up and slashed production and advertising costs in order to promote its flagship brand, but recognized that Thums Up customers were switching to Pepsi instead of Coke, hence decided to use Thums Up to compete against Pepsi. The Coca-Cola decision to consider Thums Up as the leading cola brand in Indian market was a successful venture due to the growing brand market share and equity rise (Coca-Cola enterprises, 2015).
Coca-Cola adopted differentiation focus strategy that focuses on satisfying a small segment of the industry. They adopted Thums Up that commands higher brand loyalty in the Indian market. The acquisition was the wise option for the company because Thums Up proved to be the premier cola brand in the Indian market and helped Coca-Cola to compete against Pepsi that commanded a huge market after being the first multinational to establish its footprint in Indian market. Furthermore, Thums Up is the leading cola brand in India dominating over 40 percent market share in the Indian market (Coca-Cola, 2016).
Coca-Cola completed acquisition of coconut water manufacturer, ZICO Beverages in 2013. ZICO brand comprise of pure coconut water and has various flavors including chocolate, mango, passion, and tropical. Coconut water contains natural electrolyte content that has made it the preferred brand among sports drink consumers and especially caters for consumer’s health conscious. The company aims to de...