The Coca-Cola Co.,
Atlanta, has purchased a 40 percent interest in organic tea-maker Honest
Tea, Bethesda, Md. Under terms of the agreement, Coca-Cola may elect to buy
the remaining shares of the company at a future date.
“Honest Tea is at the forefront of the rapidly
growing organic beverage business, and Seth Goldman and his management team
have successfully anticipated and met consumer needs in this expanding
category,” said Deryck van Rensburg, president and general manager of
Coca-Cola North America’s Venturing and Emerging Brands business
unit. “This transaction is a superb example of our mission in VEB to
seek out and invest in the best beverage entrepreneurs and the highest
Honest Tea co-founder and “TeaEO” Seth
Goldman shared his thoughts on the agreement in his blog on the
company’s Web site. “While Coke is now our largest shareholder,
the agreement was negotiated to ensure that Honest Tea will not be managed
or controlled by Coke,” he said. “We will continue to operate
as an independent business with the same leadership and mission.”
The driving factor behind the partnership, he
indicated, was the desire to create larger market reach for Honest Tea
products, and to spend more of his own time developing the brand.
“I have the same passion and drive for building
Honest Tea that I had in 1998, but I want to focus less on raising money,
managing production and distribution challenges, and more on building the
brand and our mission,” he said. “If we could find an investor
who will help us build our business while still honoring our style of
business, then that seems like an ideal scenario.”
Diageo chooses Ketel One, drops out of Absolut race
Diageo last week agreed to
form a new 50/50 venture with Nolet for the exclusive global rights to
sell, market and distribute Ketel One vodka. As a result, the company
pulled itself out of the running for Absolut vodka, which is under auction
by Vin & Sprit in Sweden.
London-based Diageo agreed to pay $900 million for its
half of the new company, which will be based in the Netherlands. The Nolet
family will continue to own the brand rights for Ketel One as well as the
distillery where it is produced. According to the companies, Ketel One has
annual sales of 1.9 million cases.
Commenting on the agreement, Paul Walsh, chief
executive officer at Diageo, said: “This transaction is strategically
important for Diageo, giving us an interest in an outstanding high-quality
brand and fantastic potential for global growth in the super-premium vodka
segment. The new company represents a unique alliance in our
Diageo says it expects the venture to produce a profit
in year five. The transaction is expected to close by the end of March.
Diageo’s exit from the Absolut bidding leaves
Fortune Brands, Pernod Ricard and Bacardi as frontrunners. Fortune Brands
currently distributes the brand in the United States.
Heineken USA opens center in Savannah
Heineken USA, White Plains,
N.Y., has opened a new “demand point” center in Savannah, Ga.
The center will receive 4,000 containers of Heineken Lager, Heineken
Premium Light and Amstel Light shipped from the company’s
international breweries each year.
With the opening of the location, Heineken USA has six
facilities to fill orders for its U.S. distributor network. The Savannah
facility will distribute more than 7 million cases annually to distributors
in Georgia, North Carolina, South Carolina, Tennessee, Kentucky and
“Our beers are brewed more than 3,000 miles away
at our quality breweries in Holland, requiring a logistical excellence to
ensure consumers enjoy the freshest and highest quality product
possible,” said Dan Sullivan, chief financial and operating officer
at Heineken USA. “This demand point not only delivers on that goal,
but it also lays the groundwork for further expansion in the Southeast
region, which we predict will be the second-fastest growing region for
Heineken USA over the next five years.”
Through the company’s recent supply chain
evolution, Heineken says it has been able to reduce costs and improve speed
to market. Within the past decade, it has reduced order lead time from
brewery to store shelf from 10 weeks to seven days. Day-to-day operations
in Savannah will be managed by Satellite Logistics Group, which also
operates the Houston, Miami and Charleston demand point facilities.
Tetley merges U.S. businesses
Tetley USA has integrated
the U.S. sales, marketing and finance operations of its Tetley and Good
Earth tea brands. The new group will be led by Tetley USA President Jeffrey
Freeman, and the business will be headquartered in Santa Cruz, Calif. Ron
Stroup, Clive Rowlandson and Mike Clark will lead the new sales, marketing
and finance teams, respectively.
“Tetley USA is now one company, with two
locations and three major tea brands,” noted Freeman. “Our
1-2-3 approach has successfully streamlined the company’s operations
in order to increase the market penetration and consumer takeaway of our
Tetley, Good Earth and Wildcraft tea brands.”
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The February 2020 issue dives into Essentia water, their high-pH and high aspirations for ongoing innovation. Speaking of innovation, this issue also features a special report on how (and why) the zero-proof functional beverage market is growing. Also, check out what types of rifts and shifts are shaking up the wine category and discount variety stores, as well as the latest ingredient highlights (hint: exotic fruits make an appearance). To cap it off, peruse new product releases, the latest appearances in packaging, and holistic approaches to cognitive health. Thirsty for more? Subscribe to get the latest stories delivered right to your inbox.
Check back throughout the month for additional content.
Check back throughout the month for additional content.