Coca-Cola to Purchase Stake in Green Mountain Coffee for $1.25 BillionCoca-Cola to Purchase Stake in Green Mountain Coffee for $1.25 Billion
The Coca-Cola Company and Green Mountain Coffee Roasters, Inc., have signed a 10-year agreement to collaborate on the launch of Keurigs new cold beverage platform.
February 7, 2014
ATLANTA and WATERBURY, Vt.The Coca-Cola Company and Green Mountain Coffee Roasters (GMCR), Inc., have signed a 10-year agreement to collaborate on the launch of Keurigs new cold beverage platform.
Under the agreement, GMCR and Coca-Cola will bring the Keurig Cold beverage system to consumers around the world. The companies also entered into a Common Stock Purchase Agreement, in which Coca-Cola has agreed to purchase a 10% minority equity position in GMCR.
Coca-Cola will acquire 16,684,139 newly issued shares in GMCR for approximately $1.25 billion. The newly issued shares have been priced at $74.98, which represents the trailing 50-trading-day volume weighted average price (VWAP") as of market close today.
Under the agreement, GMCR will be Coca-Colas exclusive partner for the production and sale of The Coca-Cola Company-branded single-serve, pod-based cold beverages. The 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 Companys unparalleled brand, distribution and marketing strengths with GMCRs innovative technology and beverage system expertise."
The investment is expected to close in March 2014, subject to customary closing conditions, including receipt of required regulatory approvals.
GMCRs Keurig Cold single-serve beverage system is currently under development with expected availability in GMCRs fiscal year 2015. The product will use single-serve pods to dispense freshly-made cold beverages, including carbonated drinks, enhanced waters, juice drinks, sports drinks and teas in consumers homes.
In 2013, Coca-Cola acquired ZICO Beverages, LLC, with plans to increase capabilities for ZICO, including marketing, selling, manufacturing, innovation and distribution opportunities. The transaction began in 2009, when Coca-Colas Venturing and Emerging Brands (VEB) business unit first invested in ZICO.
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