By GAI News Staff

SABMiller and Coca-Cola have reached an agreement with the government of South Africa that will clear antitrust concerns regarding a merger of the two company’s bottling businesses that involves the creation of a $27 million ag development fund according to Bloomberg.

Struck in November 2014, the pending merger entails the combining of Coca-Cola’s bottling assets with those of SABMiller and Gutsche Family Investments to create the largest bottler on the continent, spanning 12 African countries and handling 40% of Coke’s volume in Africa reports The Wall Street Journal. The completion of the merger, however, has been challenged by antitrust concerns on the part of the government of South Africa. In answer to these concerns, SABMiller and Coca-Cola have agreed to the establishment of a US$27 million fund dedicated to agricultural development along the supply chain with particular focus on training disadvantaged farmers and small-scale suppliers to the business.

A second US$27 million fund will be established to invest in downstream distribution and retail in order to support employment levels.

Upon completion of the deal, which still needs to gain approval from South Africa’s competition tribunal through a hearing to begin May 9, Coke will own 11.3% of the merged venture, Gutsch Family Investments will own 31.7%, and SABMiller will own 57%.