October 25, 2016 / 6:36 PM / 3 years ago

Japan's Coca-Cola, Kirin plan tie-up to cut costs: Nikkei

Logos are seen on Coca-Cola bottles in Zurich, February 16, 2011. REUTERS/Christian Hartmann/File Photo

(Reuters) - The Coca-Cola group in Japan and brewer Kirin Holdings Co Ltd (2503.T) are near a deal for an operational and capital partnership amid intense price competition in the Japanese soft-drink market, the Nikkei reported.

The deal could be inked as soon as this year, the newspaper reported.

The companies are looking at cross-holding shares in the new entity to be formed by the merger of Coca-Cola West (2579.T) and Coca-Cola East Japan 2580.T and in a unit of Kirin Holdings, Kirin Beverage, the Japanese daily reported. s.nikkei.com/2dTj7db

They will cooperate on distribution, including jointly shipping products to retail outlets and vending machines through the deal, according to the Nikkei.

They will also jointly procure raw materials such as juices, coffee beans and other materials, the report said.

No sales and marketing alliance is expected to be discussed, but mutual supplying and joint product development are future possibilities, the Nikkei reported.

Kirin earlier this month said it would take a minority stake in privately held Brooklyn Brewery to help it expand its craft beer offerings in Japan and Brazil.

Kirin was not immediately available for comment.

Reporting by Aravind K in Bengaluru; Editing by Maju Samuel

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