Deal strengthens PepsiAmericas flavor portfolio, expands availability
of DPS' brand in the South and Midwest
PepsiAmericas, Inc. (NYSE: PAS), and Dr Pepper Snapple Group, Inc.
(NYSE: DPS), today announced an agreement that will increase the
availability of the Crush beverage brand in PepsiAmericas'
Under the agreement, PepsiAmericas further aligns its fruit-flavored
carbonated soft drink (CSD) portfolio behind the DPS Crush brand, which
includes such flavors as orange, diet orange, grape and strawberry. The
licensing agreement with DPS increases Crush availability to
approximately 80 percent of PepsiAmericas'
U.S. system through the transfer of existing rights and the addition of
new Crush markets. PepsiAmericas will transfer distribution rights for
certain brands, including Hawaiian Punch, to DPS as part of the
transaction. Other terms of the agreement, which is expected to close in
early 2009, were not disclosed.
"PepsiAmericas is committed to providing a
diverse portfolio of products to our customers and consumers,"
said Michael Durkin, executive vice president of U.S. sales and
marketing for PepsiAmericas. "Crush is a great
brand and it brings more consistency to our flavored product offerings,
while meeting growing consumer demand for flavored CSDs."
DPS' agreement with PepsiAmericas is the
second deal involving the Crush brand announced in the past month. In
August 2008, Pepsi Bottling Group agreed to carry the Crush brand
throughout most of its territory. In total, DPS'
recent deals will more than double the current U.S. penetration of the
Crush brand and position it well for future growth.
"PepsiAmericas has long been a valued partner
as a bottler and distributor of Crush, Dr Pepper and other brands within
our portfolio," said Jim Johnston, DPS
president of sales. "We look forward to
working closely with them to expand Crush in their territories and to
realize the brand's potential as a leading
Flavored carbonated soft drinks now account for almost half of all CSD
sales in the U.S., and Orange and Diet Orange Crush compete in the
fourth largest segment of the flavor category. Orange, grape and
strawberry flavors represent about a 6 percent share of the CSD market
in the U.S. Market research shows that three out of four Americans are
aware of the brand.