The Coca-Cola Company and
Cadbury Schweppes today announced that they have signed agreements for The Coca-Cola
Company to acquire Cadbury Schweppes’ beverage brands in more than 120 countries
around the world for approximately $1.85 billion. These brands include Schweppes and
Canada Dry mixers, Dr Pepper, Crush and other regional brands. The transactions do not
apply to the U.S., France and South Africa. The agreements will give The Coca-Cola
Company ownership of outstanding brands in beverage segments in which it does not
currently participate in any significant way. Schweppes and Canada Dry tonic waters, club
sodas and ginger ales are included, as are a variety of juice products, bottled waters and
dilutables. The transactions also include acquisition of beverage base plants in Ireland
and Spain.
Completion of the transactions is subject to regulatory review in a number of countries
and certain other approvals. The Coca-Cola Company and Cadbury Schweppes anticipate
closing of the transaction in the middle of 1999.
“These agreements will allow The Coca-Cola Company to participate in segments of
the beverage business where it currently does not have meaningful entries,” said M.
Douglas Ivester, chairman of the Board and chief executive officer, The Coca-Cola Company.
“The family of Cadbury Schweppes brands will be a wonderful addition to the core
brands of The Coca-Cola Company.
“Because we currently do not have any broadly-distributed brands in these
segments, the transactions will provide our consumers and customers increased availability
of a greater variety of non-alcoholic beverages and enhanced profitability opportunities
for our customers.”
“These agreements will create immediate and substantial value for our shareowners
and simultaneously enhance our ability to develop and focus on our strong global
confectionery and U.S. beverage business,” said John Sunderland, chief executive
officer of Cadbury Schweppes.
“Cadbury Schweppes non-U.S. beverage brands are renowned and profitable,” Mr.
Sunderland added. “However, this development recognizes that they can be more
successfully grown within the broader international infrastructure which Coca-Cola has
established over many years.”
Following completion of the transactions, all of Cadbury Schweppes’ approximately
450 employees associated with the franchising of these brands and manufacturing of
concentrate in these territories will have the opportunity to take jobs with The Coca-Cola
Company.
“We look forward to welcoming Cadbury Schweppes employees to the Coca-Cola
family,” said Mr. Ivester. “Great brands do not just happen – they are the
result of the hard work of talented, committed people. Cadbury Schweppes’ beverage
team will play an important role in integrating these new brands into our business
system.”