China is Coca-Cola’s fourth largest market, and the proposed transaction would be the company’s largest overseas acquisition. If the deal goes through, it could strengthen Coca-Cola’s stranglehold in one of the world’s fast growing beverages market.

    The combined total sales of the beverage giant and Huiyuan would be 8 billion liters, lifting The Coca-Cola Company’s share of China’s soft drinks market from 16.3 percent to 18 percent, said Hope Lee, a non-alcoholic drinks analyst from Euromonitor International.

    If the acquisition goes ahead, Coca-Cola will overtake France’s Groupe Danone, which occupied a 16.3 percent share of China’s soft drinks market in 2007, as the country’s top brand with a 17.9 percent market share.     

    "Beset by shrinking demand for carbonated drinks in China, Coca-Cola has been held back by its unitary product line and has to come up with more diversified products to enhance its position, " said Teng Binsheng, a strategy professor from Cheung Kong Graduate School of Business.

    The American company launched its Minute Maid juice in China last year as part of its aggressive expansion into the nation’s fruit and vegetable drinks business, valued at $10.6 billion in 2007, while carbonated drinks only reached $7.4 billion, according to figures from Euromonitor.

    The fruit and vegetable drinks market is set to grow 16 percent to $12.3 billion this year, much quicker than the 7 percent rise expected for carbonated drinks, Euromonitor estimated.

    The deal "will enable Coca-Cola to greatly reduce its reliance on carbonated drinks," Lee said, and "still drinks’ contribution to Coca-Cola’s retail value sales will increase from 28 percent to 47 percent".

    Huiyuan’s strength is in pure fruit juice, where it has a 46 percent market share, according to ACNielsen figures.

    "Coca-Cola will successfully convert its largest rival in soft drinks into its subsidiary," said Qu Honglin, a senior partner of Glocal Strategy Consulting Co.

    Teng noted that it is a common move for foreign companies to purchase low- or medium-end brands when synergizing with local companies.

    "Recent merger and acquisition activities between overseas and domestic enterprises, including Coca-Cola and Huiyuan, Johnson & Johnson and Dabao, and Schneider Electric and Delixi, all followed this trend," he said, adding that the acquisition would complete their product lines and meet Chinese customers’ demand for medium-end products.

    As for Huiyuan, analysts said that the company would also reap great benefits from the pending transaction, thanks to the rather attractive price offered by Coca-Cola.

    "It’s a good deal for Huiyuan, as a private company it has met a growth bottleneck due to a lack of financial support from banks and the government, " Qu said.

    Teng said that Zhu Xinli, the founder and president of Huiyuan, "couldn’t say no to such a price from Coca-Cola, particularly when China’s equity market is suffering such a lean period", Teng said.

    But how successful Huiyuan will be after the acquisition largely depends on strategies devised by Coca-Cola’s top executives based in Atlanta, who will probably make the same mistakes as other multinationals synergizing with domestic brands, Qu said.

    In addition, the two companies have to surmount several obstacles ahead of their marriage.

    As it is the first major deal after the country’s anti-monopoly law came into force on Aug 1, this transaction will be a major test of the new regulation, said Zhang Tao, a lawyer from Shanghai Zhongtianxin Law Firm.

    "Regulators will probably subject the acquisition to very stringent checks," Zhang said.

    Coca-Cola said in a statement that the success of the deal is subject to the approval of China’s antitrust authorities.    

    Speaking to delegates attending the meeting, UN Secretary-General Ban Ki-moon called on the international community to "take multilateral counter-terrorism cooperation even further."

    Firstly, "we must not shy away from nontraditional approaches to promoting security," Ban said.

    Recent research has found that military force is rarely responsible for bringing an end to terrorist groups, he said.

    In the majority of cases, other factors, such as police work or the adoption of nonviolent political means, have proved more effective, he noted.

    "Thus … multilateral counter-terrorism cooperation should be undertaken in an integrated manner," he stressed.

    Secondly, multilateral counter-terrorism efforts must be done in partnership with regional and subregional organizations and with civil society, he said.

    Thirdly, as bilateral actions may be insufficient to face the immensity of the needs and circumstances, the world should maximize multilateral efforts, he said.

    Srgjan Kerim, president of the 62nd session of the General Assembly, also called on the international community to step up efforts to deliver concrete results in the fight against international terrorism.

    Kerim stressed the need for "a new way of thinking about our shared fate in a way that reflects the complexities of contemporary human and economic relations, with the well-being of the individual and communities at its center."

    "By finding gaps and identifying where further assistance is needed we can build closer cooperation between member states and the United Nations system," he said.

    The strategy was adopted by the assembly in September 2006 after a year of sometimes fractious negotiations as countries worked to overcome their differences.

    It focuses on four main pillars of action: tackling the conditions conducive to the spread of terrorism, preventing and combating terrorism, building state capacity and bolstering the role of the UN, and ensuring respect for human rights and the rule of law against the backdrop of the fight against terrorism.

    After hearing from over 60 speakers, the meeting is expected to conclude on Friday with the adoption of a resolution which reiterates support for the strategy and reaffirms member states’ condemnation of terrorism.

    "We welcome the bilateral intention to reduce strategic offensive weaponry to the minimal possible level, announced in the Sochi declaration on the Russian-U.S. strategic relationship on April 6, 2008, and to continue the drafting of a legally binding accord, which would replace the START expiring on Dec. 5, 2009," said a joint statement on global security and strategic stability issued by the CSTO.

    The foreign ministers "are convinced that reaching the above-mentioned agreement would ensure stability and predictability in strategic relations between the major nuclear countries, and build confidence in headway towards complete elimination of nuclear weapons in the world," the Itar-Tass news agency reported.

    START, a treaty took effect in 1994, bars its signatories from deploying more than 6,000 nuclear warheads atop a total of 1,600 strategic delivery vehicles.

    The CSTO, a post-Soviet security alliance, comprises Armenia, Belarus, Kazakhstan, Kyrgyzstan, Russia, Uzbekistan, and Tajikistan.