The Coca-Cola Co and Cadbury Schweppes on Dec. 11 announce landmark deal with Coke buying most of Cadbury's non-US beverage business. Transaction covers Cadbury's brands in 120 countries. Excludes France and South Africa. Volume of business Coke is buying totals about 600 mil 8-oz cases. Deal price $1.85 bil, payable $1.75 bil in cash, $100 mil in debt. Coke CEO Doug Ivester notes company pays about $3/case, adds: "We're going to layer 600 mil cases on our base business." Anticipates Coke system can grow Cadbury brands at "7-8% per year." Main brands covered include Schweppes and Canada Dry mixers plus Dr Pepper, Crush and Penafiel. Cadbury global beverage CEO John Brock tells BD: "We have outstanding brands and an excellent team of people." But acknowledges Cadbury can't develop its brands outside US "as well as someone with a broader infra-structure." Brock notes deal provides enhanced value for Cadbury and Coke.

Plus. Cadbury also intends to sell its non-US bottling operations plus its brands in France and South Africa. Cadbury tells UK analysts sale "expected to realize" about $835 mil. Cadbury has bottling operations in: Australia, Belgium, France, Mexico, Portugal, Spain, Zambia and Zimbabwe. Cadbury says it expects to complete these transactions in 12 months.

Beverage Digest publishes special issue about this deal Dec. 11. Call (914) 244-0700 to order a copy, or click here for more information about ordering back issues.