The Coca-Cola Company And Nestlé Further Refine Beverage Partners Worldwide Joint Venture
Agreement Provides The Coca-Cola Company and Nestlé Greater Flexibility in the U.S. Tea Category
VEVEY, Switzerland AND ATLANTA, March 27, 2007 - The Coca-Cola Company and Nestlé today announced they have further refined their previously announced agreement to refocus the activities of their Beverage Partners Worldwide (BPW) joint venture.
Under the terms of the revised agreement:
* BPW will focus 100 percent on the total tea category.
* BPW will cease all activities in the United States.
* The Coca-Cola Company has entered into a Master Sublicense Agreement (MSA) with Nestlé for the Nestea and Enviga brands in the United States.
* The Coca-Cola Company and Nestlé will be able to develop or acquire additional tea brands to compete more aggressively in the U.S. tea segment.
* Per the November announcement, The Coca-Cola Company and Nestlé will be able to compete in coffee in any country after the closing of the agreement.
* All BPW coffee initiatives will revert to Nestlé on a market-by-market basis during an orderly transition period ending no later than Dec. 31, 2008.
“A joint venture focused on the total ready-to-drink tea category, excluding the US and Japan, provides an opportunity to optimise value for all stakeholders,” said Leslie Novos, CEO of BPW. “The redefined scope affords BPW the opportunity to grow existing and new brands consistent with a leadership agenda outside the US and Japan.”
The refined agreement enables both companies to independently compete in the fast growing tea categories in the United States. Consistent with the previous agreements, BPW will also refrain from operations in Japan. The transaction, which is subject to customary regulatory reviews, is expected to close by April 30, 2007.
Beverage Partners Worldwide (BPW), a 50-50 joint venture held by Nestlé and The Coca-Cola Company, was created in 2001, following a period of 10 years during which Nestlé and The Coca-Cola Company cooperated in a joint venture called Coca-Cola and Nestlé Refreshments.
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