Coca-Cola Amatil cuts Aussie icon SPC’s value from $147m to zero

Coca-Cola Amatil says it’s confident for the future of the canned fruit and vegetable business despite its value being slashed.

Coca-Cola Amatil says the sale of SPC is progressing despite the major soft drink brand slicing the value of the canned fruit business to just zero.

The company confirmed in November it would put the canned fruit and vegetable operations up for sale and said on Monday several interested parties had toured the manufacturing facilities in Victoria’s Shepparton.

But CCA also said the inherent uncertainty of the sale had meant the company had slashed the value of the once iconic SPC from $147 million before tax to zero for the 2018 year.

SPC Managing Director Reg Weine today said this was triggered by the “size and structure” of the range of offers.

“While accounting standards necessitate this impairment, it does not reflect SPC’s market value or the offers received and doesn’t indicate any change to SPC’s publicly reported outcomes,” he said.

“We see a positive future for SPC as a market leader in processed fruit and vegetables.

“The sale process is about unlocking this future value.”

A $100 million co-investment over the last four years from CCA and the Victorian Government kept the cannery’s doors open and modernised the manufacturing site.

Despite the value of the brand being slashed, its managing director said the sale is progressing well.

Mr Weine said the company had received several local and international non-binding offers but refused to reveal who a potential buyer may be.

“Parties in this process clearly recognise the value in SPC’s iconic brands, the strategic location of our manufacturing assets in the heart of the Goulburn Valley, and our proximity to fast growing export markets like China,” he said.

“It also reflects the significant transformation of SPC’s Shepparton manufacturing site and the state-of-the-art processing and packaging capability that is available to potential buyers of SPC.

“The overall level of interest is recognition of the inherent value of Australian agricultural assets and the iconic nature of SPC and its market leading brands.”

$100 million was spent modernising the facility at Shepparton.

The co-investment was completed mid-last year and had allowed SPC to expand its export range into China, the company said.

Mr Weine said there would be no changes to jobs or the operations of the brand despite the slashing of its value.

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Originally published as Coca-Cola Amatil cuts Aussie icon SPC’s value from $147m to zero