Coke Eyeing Glaceau?
Published in CSP Daily News
Analyst says purchase would be "a strategic positive"
ATLANTA -- Following closely on the heels of its acquisition of FUZE Beverage LLC, Coca-Cola North America is said to be in talks to purchase or take a partial stake in Glaceau Vitaminwater.
Beverage Digest reported that Coke is in potential talks to acquire the enhanced water brand, and beverage analyst William Pecoriello said such an acquisition would benefit the major beverage manufacturer.
"We view a potential Coke acquisition of Glaceau Vitamin Water as a strategic positive," Pecoriello of New York-based Morgan Stanley stated [image-nocss] in a research note yesterday. "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."
Beverage Digest also cited sources who believe the deal could close by early May.
Neither company has commented on the report, and Pecoriello 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.
Earlier this month, 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.