Canadian Packaging

Coca-Cola spends $1.25 billion on coffee deal

By Canadian Packaging Staff   

General Coca-Cola soda machine for the home GMCR Green Mountain Coffee Roasters Inc Keurig Cold The Coca-Cola Company

Apparently $1.25 billion only gets one about 10% of the Green Mountain Coffee Roasters, but it does give the soft drink manufacturer a chance to deliver a new at home beverage system for Coke.

ATLANTA & WATERBURY, Vt.—Make your own Coca-Cola at home? It just became a step closer to reality as the Coca-Cola Company and the Green Mountain Coffee Roasters, Inc. (GMCR) announced they have signed a 10-year agreement to collaborate on the development and introduction of The Coca-Cola Company’s global brand portfolio for use in GMCR’s forthcoming Keurig Cold at-home beverage system.

GMCR is recognized for its award-winning coffees, innovative Keurig Single Cup brewing technology.

For only $1.25 billion, Coca-Cola Company will acquire 16,684,139 newly issued shares in GMCR – which means it will have a about 10% ownership in GMCR.

Under the global strategic agreement, GMCR and The Coca-Cola Company will cooperate to bring the Keurig Cold beverage system to consumers around the world.

As part of the strategic collaboration, GMCR will be The Coca-Cola Company’s exclusive partner for the production and sale of The Coca-Cola Company-branded single-serve, pod-based cold beverages.

GMCR’s Keurig Cold single-serve beverage system is currently under development with expected availability in GMCR’s fiscal year 2015. Keurig Cold will use precisely formulated single-serve pods to dispense freshly-made cold beverages including carbonated drinks, enhanced waters, juice drinks, sports drinks and teas in consumers’ homes with the one-touch simplicity, quality and variety that North American consumers love about the Keurig brand hot system platform. The cold system is expected to be a similarly open-architecture platform like the Keurig hot system.

The two companies also will explore other future opportunities to collaborate on the Keurig platform.

“With The Coca-Cola Company as a global strategic partner in our multi-brand at-home Keurig Cold beverage system, we believe there is significant opportunity to premiumize and accelerate growth in the cold beverage category by empowering consumers with an innovative, convenient way to freshly prepare their favorite cold beverages at the push of a button,” said Brian P. Kelley, President and CEO of GMCR. “This global relationship combines The Coca-Cola Company’s unparalleled brand, distribution and marketing strengths with GMCR’s innovative technology and beverage system expertise.”

Muhtar Kent, Chairman and Chief Executive Officer, The Coca-Cola Company adds: “Our 2020 Vision calls for decisive and timely action to continuously improve and evolve our global system to best serve our customers and consumers around the world.

“This agreement demonstrates our creative approach to partnerships and ability to identify and stay at the forefront of consumer trends driving the industry. By pairing The Coca-Cola Company’s brand leadership and global footprint with GMCR’s innovative technology, together we will be able to capitalize on the many exciting growth opportunities in the single-serve, pod-based segment of the cold beverage industry. Importantly, this partnership provides our consumers with a convenient way to enjoy the brands they love through in-home preparation.”

The investment is expected to close in March 2014, subject to customary closing conditions, including receipt of required regulatory approvals.

More information on Keurig and GMCR can be found: www.gmcr.com.

And, for The Coca-Cola Company, the world’s largest beverage company with more than 500 sparkling and still brands, visit www.Coca-ColaCompany.com.

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