PrivateEquity

Goldman Sachs Backs Coca-Cola Deal with $600M Investment

Goldman Sachs Asset Management is investing $600 million in convertible preference shares to help Jubilant Bhartia Group acquire a 40% stake in Coca-Cola’s bottling division in India, valued at $1.5 billion.

Summary:
Goldman Sachs Asset Management has made a significant investment by pledging $600 million in equity to the Jubilant Bhartia Group. This funding will aid in the group’s $1.5 billion purchase of a 40% stake in Coca-Cola India’s bottling operations. Structured as convertible preference shares, the investment minimizes equity dilution for Jubilant while reducing debt burden and underscores the growing role of private credit in large-scale M&A transactions in India. The remaining funds will be raised through a mix of equity and traditional debt channels by Jubilant.

Goldman Sachs Powers Coca-Cola India Bottler Deal with $600 Million Investment
New Delhi/Mumbai, June 2025 — Goldman Sachs Asset Management (GSAM) has made a significant cross-border finance move by investing $600 million in private equity to support Jubilant Bhartia Group’s $1.5 billion acquisition of a 40% stake in Coca-Cola’s Indian bottling operation.
This investment — structured as convertible preference shares — not only underscores Goldman’s bullishness on India’s fast-growing consumer sector but also reflects the emergence of private credit as a powerful enabler of large M&A financing in the country.

Deal Structure: Balanced Funding for a Strategic Buyout
The Jubilant Bhartia Group, known for its diversified business interests across food services, pharmaceuticals, and infrastructure, is acquiring the stake in Hindustan Coca-Cola Beverages Pvt. Ltd. (HCCB) — Coca-Cola’s flagship bottling and distribution unit in India.
Goldman Sachs’ $600 million equity infusion will be routed through convertible preference shares, a hybrid instrument that provides fixed returns while offering optional conversion into equity at a future date. This funding strategy limits equity dilution, avoids excessive leverage, and gives Jubilant the financial flexibility to pursue post-acquisition growth initiatives.
The remaining $900 million required for the transaction will be sourced through:
Internal equity contributions from Jubilant Bhartia
Commercial debt from domestic and international banks
Possible co-investment from institutional partners
This funding mix allows Jubilant to retain operational control and strategic influence over the bottling business while keeping long-term liabilities in check.

Why This Deal Matters
Acquiring a significant share of HCCB is a strategic move aimed at capitalizing on the rapidly growing beverage consumption market in India. India is one of the fastest-growing markets for Coca-Cola globally, with an expanding middle class, rapid urbanization, and increasing preference for branded non-alcoholic beverages.
HCCB controls the production and distribution of a large portfolio of Coca-Cola’s products, including:
Coca-Cola and Diet Coke
Thums Up, Maaza, Sprite, and Fanta
Kinley water and Minute Maid juices
The acquisition gives Jubilant a direct stake in this high-margin, high-growth segment, with opportunities to optimize logistics, expand into rural areas, and introduce new product lines.

Goldman Sachs’ Private Credit Strategy in Action
This deal marks one of the largest private credit investments in India’s consumer sector by an international financial institution. Goldman Sachs has increasingly been deploying capital through its alternative investments and asset management arm, especially in growth-oriented, cash-generating companies across Asia.
Private credit — or non-bank lending — has been gaining traction globally as companies seek faster and more flexible capital solutions than what traditional banks can offer.
“Our investment in Jubilant’s acquisition of HCCB aligns with our strategy to support transformational deals in high-potential markets like India. This is not just capital, but partnership capital,” said a senior executive at GSAM.
By doing this, Goldman Sachs aligns itself with a rising group of global investors, including Blackstone, KKR, and Brookfield, who are investing in India’s consumption-driven growth narrative.

Industry Implications: Consolidation and Scale
The sale of the Coca-Cola India bottler stake indicates a wider trend of consolidation and localization within the beverage sector. By transferring operational control to an Indian partner, Coca-Cola can focus more on brand building, product innovation, and franchise management, while Jubilant takes charge of on-ground execution and distribution.
Analysts believe that the deal could set a precedent for other multinationals exploring asset-light models in India, particularly in food and beverage, logistics, and retail.
Moreover, this acquisition could reignite competition in the soft drinks segment, where rivals like PepsiCo and Dabur have been expanding aggressively.

Financial and Strategic Outlook
Jubilant’s entry into the Coca-Cola bottling business is expected to add significant revenue to its books and create synergies across logistics, retail, and cold-chain infrastructure. Industry estimates suggest that the bottling unit generates annual revenues exceeding ₹12,000 crore ($1.4 billion) with EBITDA margins of around 15%–18%.
With Goldman Sachs as a long-term capital partner, Jubilant may also look at expanding capacity, modernizing bottling plants, and increasing rural penetration, especially in tier-2 and tier-3 cities where demand for beverages is surging.

Challenges and Watchouts
Despite the positive sentiment, experts caution that the bottling industry is capital-intensive, highly seasonal, and sensitive to regulatory changes. Factors like:
High sugar taxes
Rising PET packaging costs
ESG concerns around water usage
Increasing preference for healthy alternatives
…could pose challenges to long-term profitability. However, with strategic, operational management and innovation, the acquisition could still yield strong returns on investment.

Conclusion: A Milestone Deal for India’s Beverage Landscape
Goldman Sachs’ $600 million equity investment represents a significant milestone for both India’s private equity and beverage industries. For Jubilant Bhartia Group, the deal represents a transformational diversification move into one of the most lucrative consumer segments. For Coca-Cola, it’s a calculated step to localize operations while remaining a dominant brand in Indian households.
This deal not only showcases the rising importance of private credit in Indian M&A but also reaffirms global confidence in India’s consumption-driven growth narrative.

The image added is for representation purposes only