ATLANTA -- Coca-Cola North America has filed a premerger notification with U.S. regulators about the proposed acquisition of Vitaminwater maker Glaceau, confirming an exclusive CSP Daily News report from April.
According to Beverage Digest, as cited by Reuters, the world's largest beverage company filed a Hart-Scott-Rodino Act notification with the U.S. Federal Trade Commission, which is required for proposed deals of significant size. The FTC and the Department of Justice will now assess whether the deal is likely to reduce marketplace competition.[image-nocss]
A Coca-Cola spokesperson declined to comment, but Beverage Digest said a deal, which could be worth about $4 billion, is still likely subject to approval by Coca-Cola's board of directors. Glaceau, which is 30% owned by India's Tata Tea Ltd., maker of Tetley Tea, could not immediately be reached for comment by Reuters.
In April, when the acquisition was first hinted at, beverage analyst William Pecoriello said such a deal would benefit Coca-Cola.
"We view a potential Coke acquisition of Glaceau Vitaminwater as a strategic positive," Pecoriello of New York-based Morgan Stanley stated in a research note. "It would help fill a big gap in Coke's North America non-carb portfolio in a segment [enhanced water] that we expect to capture 22% of the non-alcohol, liquid-refreshment-beverage revenue pie over the next five years [second only to bottled water]."
He added that a Glaceau purchase "would provide a brand platform that crosses the juice, tea, energy and sports segments with international potential."
Pecoriello also noted that the Atlanta-based company may take only a partial stake in Glaceau. Recently, Coke management has said it would seek to fill out its U.S. noncarb portfolio in "rapid fashion," including bolt-on acquisitions, according to Pecoriello.
In early April, Coca-Cola closed on its purchase of FUZE Beverage, maker of FUZE enhanced juices and teas. That acquisition included all FUZE brands, including the Vitalize, Refresh, Tea and Slenderize lines under the FUZE trademark, WaterPlus enhanced water products and license rights to the NOS Energy Drink brands.
Glaceau is the brand name of a line of products sold by Energy Brands Inc., a beverage company based in Whitestone, N.Y. Its products include Vitaminwater, Fruitwater and Smartwater.
Members help make our journalism possible. Become a CSP member today and unlock exclusive benefits, including unlimited access to all of our content. Sign up here.