Cott Corporation, the Mississauga, Ont. headquartered company that is one of the world’s largest non-alcoholic beverage companies and the world’s largest retailer brand soft drink company announced on July 7, 2010 that it has signed a definitive agreement to acquire the privately-held Cliffstar Corporation–headquartered in Dunkirk, NY–the leading private label manufacturer of shelf stable juices, for cash consideration of $500 million, payable at closing, and subject to adjustments for working capital and other items.
In addition to the $500 million due at signing, Cliffstar is entitled to $14 million of deferred consideration, which will be paid over a three-year period. Cliffstar is also entitled to an additional contingent earnout consideration of up to a maximum of $55 million, based upon the achievement of certain performance measures during the fiscal year ending January 1, 2011 as well as the successful completion of certain expansion projects in 2010.
Cott, for the year ending April 30, 2010, had an adjusted EBITDA of US$166 million, while Cliffstar’s EBITDA is US$80 million.
“As the clear leader in private label shelf-stable juice, Cliffstar is an ideal partner for Cott as we strengthen our position in private label beverages,” states Jerry Fowden, chief executive officer of Cott. “A combination with Cliffstar expands Cott’s product portfolio and manufacturing capabilities, enhances our customer offering and growth prospects, and improves our strategic platform for the future. Combined with Cliffstar, Cott will be a more diversified company with long-term advantages for our shareowners and retailer partners.”
Stanley Star, chairman of the board and co-founder of Cliffstar says his company has found the right long-term strategic partner. "Cott, like Cliffstar, has a long history of private label excellence and quality as well as close partnerships with its customers and suppliers. In addition to a strong position in juice and various new age growth segments, Cliffstar brings expertise in juice ingredients, processing and bottling that are complementary to Cott’s strengths in carbonated soft drinks. I believe the combination will be beneficial for Cliffstar’s employees, customers and suppliers into the future. ”
For more information, visit www.cott.com/investors/news/en.htm.