The price reflects rarity value – Chinese entrepreneurs, especially in companies with Huiyuan's market position, do not often sell. The purchase enables Coca-Cola to regain the number one slot in Chinese soft drinks it lost in the 1990s to Danone, thanks to the latter's strength in bottled water. More important, Coke doubles its share, to about 20 per cent, of a juice market that Euromonitor International forecasts will grow 66 per cent between 2008 and 2012. That is more in absolute volume terms than the next three big emerging juice markets of Russia, Mexico and Poland combined.

Within that, Huiyuan has 42 per cent of China's “pure” juice market – a sweet spot in the juice category with the highest margins and growing about 30 per cent a year. It gives Coke a strong brand, distribution network and a currently underutilised manufacturing base. Huiyuan is stronger in northern China than in the south – where Coke has a greater presence. Coke also gets product development expertise in a market of idiosyncratic consumer tastes.

Huiyuan's parent group has activities in upstream raw materials, a competitive advantage that should be retained. Add in Coke's buying clout and opportunities for cost savings in packaging and ingredients should be considerable. Coke is giving no details of expected revenue or cost synergies, so investors have to take its promises on trust. But, at a price of $2.4bn, Coke (market capitalisation $120bn) is hardly betting the company on the outcome. Assuming no regulatory problems, prospects look sufficiently juiced-up to justify the frothy price.