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Cadbury Schweppes plc intends to sell its Europe Beverages business, to focus financial and management resources on its confectionery and North American and Australian beverage businesses, which have greater potential for higher growth and returns. Proceeds from the sale will initially be used to reduce the company's net debt.
Todd Stitzer, CEO of Cadbury Schweppes said, "Europe Beverages has a great portfolio of brands, a talented management team and strong routes to market. I'm proud of the commitment and dedication of its workforce. However, the potential for growth and value creation is greater in the other operations, and therefore we believe it is in the best interests of our shareowners to investigate a sale of the business."
Its main brands are Schweppes, Orangina, TriNa, Oasis and La Casera, which account for around 75 percent of sales. Other brands include Apollinaris, Pampryl, Gini and Vida. Products are sold across Continental Europe, with some sales in the UK, parts of North and West Africa and the Middle East. Sales are concentrated in three countries, France, Spain and Germany, which account for around 85 percent of total sales.
Following the acquisition of the Adams confectionery business in 2003 and subsequent organic growth, Cadbury Schweppes has become the leading company in the global confectionery market. It has the broadest category participation and geographic footprint in the global confectionery industry.
Investments in marketing, innovation, science and technology and sales and distribution have accelerated the company's confectionery sales growth: in 2004, confectionery sales grew by 6 percent compared with average annual growth of 3 percent in the previous three years; in the first half of 2005, the company's confectionery sales grew by 7 percent.