Beverage firm The Coca-Cola company's Bottling Investments Group China (BIG) has entered into a definitive agreement with COFCO Coca-Cola Beverages and Swire Beverages Holdings to refranchise its current bottling operations in China.

As part of the agreement, the company's bottling system in China will be divided between COFCO and Swire.

In China, 18 bottling plants will be owned and operated by COFCO, and 17 by Swire.

"I believe this restructure will create greater value for shareholders and society."

It is reported that currently the Coca-Cola system in China is investing $4bn locally for future growth from 2015-2017, expanding the $9bn of investments made in the market since 1979.

Coca-Cola along with existing partners COFCO and Swire has notified a non-binding letter of intent in February to negotiate the realignment of its bottling operations.

The Coca-Cola Company chairman and chief executive officer Muhtar Kent said: “This announcement marks the latest important chapter in the ongoing transformation of our business to refocus on our core strengths of building great brands and leading a strong, global franchise system.

"We remain excited about our long-term growth prospects in China and see today’s announcement as a key milestone in our nearly three decades of continuous investment in the world’s second-largest economy

“This transaction demonstrates BIG’s role in supporting long-term investment and building the right culture to ensure a sustainable healthy business.”

The current China transaction will be subjected to government regulatory approvals.

Until the transaction is complete, all bottling plants and customer relationships will operate under existing bottling ownership.

COFCO chairman ZHAO Shuanglian said: “This transaction marks a new milestone in the history of COFCO and Coca-Cola cooperation, and opens a new era of two franchise partners bisecting Coca-Cola’s marketplace in China.

"I believe this restructure will create greater value for shareholders and society.”