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NEW YORK -- Coca-Cola Co. is reportedly eyeing Cadbury Schweppes Plc's Snapple iced tea brand for possible acquisition, according to Beverage Digest, which cited several Coke executives as saying that "Coke might be interested -- or in words of some, should be interested -- in buying Snapple to beef up its tea business."
Snapple, which sells flavored teas, lemonades and juice drinks, was the third-largest bottled tea brand in the first quarter, ahead of Coke's entire tea portfolio, including Nestea, Gold Peak and recently-acquired Fuze, Beverage Digest data showed.
Coke spokesman Ben Deutsch declined to comment.
"Coke still needs to do work on its North American tea portfolio," Beverage Digest publisher John Sicher said. "Snapple, though it hasn't been growing recently, could make sense for Coke, but there's no indication yet that the brand is for sale."
Reuters reported that Britain-based Cadbury, the world's largest confectionery company, is getting ready to separate its drinks arm, which includes Dr Pepper, 7UP, Snapple and Hawaiian Punch. Last week, Chief Executive Todd Stitzer said a sale of the $15.9 billion North American business was more likely than a spinoff.
Sources familiar with the situation say at least two groups of private-equity firms were bidding for the business. Private-equity firms generally fund their purchases with a lot of debt, and often sell off underperforming units to help pay some of it down.
In other Coca-Cola news, Campbell Soup Co. said Coca-Cola North America will distribute its juices in the U.S. and Canada, starting in September. The companies did not disclose financial terms of the deal, which applies to single-serve bottles of V8, V8 V-Fusion, V8 Splash and Campbell's tomato juices, The Associated Press reported.
The new agreement will mean more access for the juices, particularly in convenience stores where they've been hard to find in the past, as well as delis, pizzerias, golf courses and vending machines. "This is a bold move for us," Denise Morrison, Campbell USA president, told the AP. "We see this as a very significant growth opportunity."
Campbell has been pushing the juices harder in the last few years, hoping to benefit from increasingly health-conscious consumers. The strategy has worked: The company said in its most recent earnings report that its beverages line was its top-performing business.