Industry Issues

June 1, 2006
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A-B Buys Rolling Rock
Anheuser-Busch last month purchased Rolling Rock from InBev USA for $82 million. The deal includes the global brand rights and recipes for the Rolling Rock beers, however, the Latrobe, Pa., facility that has been home to Rolling Rock will be sold and production will be moved to A-B’s Newark, N.J., plant in August.
“We have an ideal opportunity to grow this historic brand,” said Anheuser-Busch President August Busch IV. “This beer is not like others, and its consumer following is equally distinctive. We live in a diverse world where consumers are hungry for variety. Acquiring Rolling Rock enables us to reach a new audience and to continue building our broad portfolio of products that meet the wide-ranging needs of consumers.”
For its part, InBev says the decision to sell Rolling Rock was based on its desire to focus on higher-growth import brands such as Stella Artois, Bass Pale Ale, Beck's, Brahma and Labatt Blue.
Anheuser-Busch also is investing in in Chicago’s Goose Island Beer Co. via its interest in Widmer Brothers Brewing. Widmer, based in Oregon, has acquired a minority share of Goose Island. A-B in turn, owns a stake in Widmer, giving the Chicago brewer access to a wider distribution network.
Pepsi to distribute Ethos water
Starbucks Coffee Co. and PepsiCo have expanded their North American Coffee Partnership to include water, with an agreement that will allow Pepsi to distribute Starbuck’s Ethos water. The companies say the agreement will include the co-packing, distribution and marketing of Ethos products in the United States and Canada, and will significantly increase distribution of Ethos at the retail level.
Currently, Ethos water is available at more than 5,000 Starbucks stores and several smaller local retailers in the United States. Plans include additional bottle sizes and case packs.
Ethos Water was founded in 2002 by Peter Thum and Jonathan Greenblatt, and acquired by Starbucks in April 2005. It was created to raise awareness and funds to bring clean water to children around the world. The companies say they will continue to make a $0.05 donation for each bottle of Ethos water sold in all distribution channels.
McDonald’s to boost beverage lineup
Fast food giant McDonald’s Corp. is experimenting with new beverage offerings, including bottled drink sales through drink coolers. The chain is said to be testing sweet iced tea in 3,000 restaurants in the southern United States and iced coffee in the Northeast. It also is looking into energy drinks and flavor shots to allow consumers to customize their fountain soft drinks.
“We are looking very closely at our overall beverage strategy,” McDonald’s Chief Executive Officer James Skinner said at a press conference after the company’s annual meeting.
The company has been working with Coca-Cola to test bottled products in Texas locations, and the companies have said the results are “promising.” The move potentially would open McDonald’s beverage business to companies other than Coca-Cola, particularly in the single-serve category. BI
Frïs changes hands
FutureBrands LLC and The Absolut Spirits Co. Inc. have begun importing and marketing  Frïs Vodka in the United States. Frïs Vodka is owned by parent company V&S Absolut Spirits, and previously was imported by Shaw-Ross International Importers. FutureBrands LLC is Absolut’s joint venture with Beam Global Wine and Spirits Inc.
Frïs Vodka is created through a freeze distillation process, an additional step in the distillation process that significantly reduces the temperature of the spirit to remove impurities, and is available in Original, Lime and Apple varieties.
V&S Group also announced it finalized the sale of Danzka Vodka to Belvedere SA. V&S will continue to produce Danzka for the next five years.
Ito En adds distribution
Green tea manufacturer Ito En North America Inc., based in New York City, has purchased Mason Distributors Inc. of Miami Lakes, Fla. Mason is a distributor of vitamin, mineral and herb supplements, and is the first wholly owned subsidiary to be added to Ito En’s U.S. operations.
Commenting on the move, Yosuke Honjo, president of Ito En North America said,  “With the acquisition of this company, Ito En is able to enter the supplement market and anticipates an effective synergy with our core green tea business and increasing the value and success of the group as a whole.”
Pepsi, Glaceau reach packaging agreement
PepsiCo last month agreed to change the look of its SoBe Life Water after a dispute with Glaceau, Whitestone, N.Y., over trade dress. The agreement settles the lawsuit brought by Glaceau in April, which claimed the Life Water package was too similar to Glaceau Vitaminwater
7 UP’s ‘natural’ campaign under fire
The food industry watchdog group the Center for Science in the Public Interest has threatened to sue Cadbury Schweppes Americas Beverages over its new 7 UP campaign that touts the product’s natural ingredients. At issue is the use of high fructose corn syrup, which the group claims is not a natural ingredient.
The company responded by saying it was “entirely confident in the accuracy” of the claim, and that high fructose corn syrup is a natural ingredient made from corn and is processed using similar methods to other natural foods and ingredients.  
NBWA’s Purser tapped for Association Committee of 100
The U.S. Chamber of Commerce recently selected Craig Purser, president of the National Beer Wholesalers Association, to the Association Committee of 100 (C100), a group that includes the country’s leading association chief executives. The C100’s goal is to provide advice to the U.S. Chamber of Commerce board of directors; enhance Chamber lobbying and coalition work; recommend programming; and strengthen outreach to the business and association community. Purser joins a prestigious group that includes five former members of Congress, two governors, and several “Executives of the Year.”
Brown-Forman acquires Chambord
Brown-Forman has added the Chambord brand and related assets from Charles Jacquin et Cie to its business for $255 million dollars. The deal includes the Chambord trademark, and the French manufacturing operations where the brand is produced.  
Chambord is a super-premium, black raspberry liqueur that is produced and bottled in France. It becomes part of Brown-Forman’s Developing Brands portfolio, a group of growing super-premium brands that also include Amarula Cream Liqueur, Appleton Estate Jamaica Rum, Don Eduardo Tequila, Tuaca Liqueur and Woodford Reserve Bourbon.
National, Republic to merge
National Distributing Co., Atlanta, and Republic Beverage Co., Houston, announced last month that they will merge to create the second-largest wine and spirits distributor in the United States. The combined company will be worth $4 billion and employ 5,500 people. The company will operate in more than 19 states.
New Belgium expands production
New Belgium Brewing Co., Fort Collins, Colo., is planning a more than $21 million expansion, according to a report in the Rocky Mountain News. The company will add a new 5,500-square-foot bottling facility as well as new equipment that will allow it to turn out 700 bottles per minute.
The company says the project will include environmentally friendly building materials, and will feature natural lighting and a Freon-free heating and cooling system.
Back to school
Beverage distributor Glazer’s, based in Dallas, has opened Glazer’s Beverage University, an “eLearning” Web site that offers courses on wine, distilled spirits, and malt beverage products. The company says the goal of the online learning center is to provide its customers with an ongoing resource on adult beverage products and industry best practices.
“Glazer’s is a recognized industry leader in how we educate and train our salespeople on brand and category knowledge, as well as world class selling techniques,” Vice President of Training and Development for Strategic Accounts Bill Saul says. “Our internal corporate education and training program is called the Glazer Beverage Academy. The Glazer Beverage Academy is a fully integrated sales training program, covering all categories and beverage types, channel-specific business-building training programs, and all levels of sales management training … By extending our internal training programs to our customer base, we believe that we position Glazer’s to be the most credible voice in the industry for growing the beverage category.”

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