Coca-Cola, Tabani tussle intensifies
Friday, 20 July 2012
Jasim Khan
Tussle between global soft drink giant Coca-Cola and Tabani Beverage Ltd owned by former freedom fighters' Trust has reached its climax as Tabani stood firm to its claim of Tk 16 billion compensation and Coca-Cola wanted to set up a new joint venture plant without paying compensation.
Tabani Beverage management claimed that it has invested about Tk 10 billion to expand the plant, bought land and trained human resources as per suggestion of Coca-Cola. It said the Coca-Cola cancelled the franchise agreement with Tabani in 2008 without complying necessary procedures.
On the other hand, Coca-Cola claimed that they cancelled the agreement with Tabani because the Trust failed to establish a PET (Polyethylene terephthalate) bottling plant timely.
Abul Hasnath, Deputy Secretary, Ministry of Liberation War, who is working as mediator to resolve the dispute told The FE that Coca-Cola ignored the law of the land and cancelled the agreement with Tabani whimsically.
"The factory plant, machinery, huge land and skilled work force remained idle. If they want to cancel the agreement, they should pay the compensation to 400 employees and other financial losses of the trust," Abul Hasnath added.
He alleged that Coca-Cola's investment proposal is a 'tricks' to allure the government so that it approves canceling the franchise with Tabani Beverage without paying any compensation.
A local representative of Coca-Cola told the FF that the company plans to start afresh the sales and distribution operation in the region aiming to ensure quality of products which they do in other regions.
Tabani failed to come up with the timely response as Coca-Cola demanded. The company had to maintain equal quality as it does in the international markets, he said.
"We want to come back with Coke, Sprite and Fanta to the market. These are big brands we lost to other competitors largely because of absence of Coca-Cola drinks in this market since August 2008," the official added.
About the investment proposal, the official said the proposal of investment of US$ 400 million has been placed before the Board of Investment (BoI) and the company is hopeful that the BoI will soon approve the proposal.
Md. Fazlul Hoque Khan, Manager, Land and Law, Bangladesh Freedom fighters Welfare Trust said Coca-Cola now came up for a mutual solution sensing that they may loss if the matter is taken to the court.
"We wanted to comply with all terms and conditions Coca-Cola set for us. But their intention to bypass Tabani and do business with another local group is clear to us. If they want to do so, they should compensate the trust," Fazlul Hoque Khan added.
"We have investment in machinery, marketing network and work force. The biggest loss will be in business reputation." he added.
Meanwhuile, Coca-Cola continued partial marketing through franchise agreement with another bottler and marketer, Abdul Monem Ltd.
Tussle between global soft drink giant Coca-Cola and Tabani Beverage Ltd owned by former freedom fighters' Trust has reached its climax as Tabani stood firm to its claim of Tk 16 billion compensation and Coca-Cola wanted to set up a new joint venture plant without paying compensation.
Tabani Beverage management claimed that it has invested about Tk 10 billion to expand the plant, bought land and trained human resources as per suggestion of Coca-Cola. It said the Coca-Cola cancelled the franchise agreement with Tabani in 2008 without complying necessary procedures.
On the other hand, Coca-Cola claimed that they cancelled the agreement with Tabani because the Trust failed to establish a PET (Polyethylene terephthalate) bottling plant timely.
Abul Hasnath, Deputy Secretary, Ministry of Liberation War, who is working as mediator to resolve the dispute told The FE that Coca-Cola ignored the law of the land and cancelled the agreement with Tabani whimsically.
"The factory plant, machinery, huge land and skilled work force remained idle. If they want to cancel the agreement, they should pay the compensation to 400 employees and other financial losses of the trust," Abul Hasnath added.
He alleged that Coca-Cola's investment proposal is a 'tricks' to allure the government so that it approves canceling the franchise with Tabani Beverage without paying any compensation.
A local representative of Coca-Cola told the FF that the company plans to start afresh the sales and distribution operation in the region aiming to ensure quality of products which they do in other regions.
Tabani failed to come up with the timely response as Coca-Cola demanded. The company had to maintain equal quality as it does in the international markets, he said.
"We want to come back with Coke, Sprite and Fanta to the market. These are big brands we lost to other competitors largely because of absence of Coca-Cola drinks in this market since August 2008," the official added.
About the investment proposal, the official said the proposal of investment of US$ 400 million has been placed before the Board of Investment (BoI) and the company is hopeful that the BoI will soon approve the proposal.
Md. Fazlul Hoque Khan, Manager, Land and Law, Bangladesh Freedom fighters Welfare Trust said Coca-Cola now came up for a mutual solution sensing that they may loss if the matter is taken to the court.
"We wanted to comply with all terms and conditions Coca-Cola set for us. But their intention to bypass Tabani and do business with another local group is clear to us. If they want to do so, they should compensate the trust," Fazlul Hoque Khan added.
"We have investment in machinery, marketing network and work force. The biggest loss will be in business reputation." he added.
Meanwhuile, Coca-Cola continued partial marketing through franchise agreement with another bottler and marketer, Abdul Monem Ltd.