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Cott Expands Beverage Porfolio With $1.25 Billion Transformational Acquisition

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Cott Expands Beverage Porfolio With $1.25 Billion Transformational Acquisition

Cott Expands Beverage Porfolio With $1.25 Billion Transformational Acquisition
November 10
09:24 2014

Canada-based international beverages group Cott Corporation has agreed to acquire DSS Group, parent company to DS Services of America, a leading water and coffee direct-to-consumer services provider in the United States, for approximately $1.25 billion.

The acquisition will extend Cott’s beverage portfolio into new and growing markets, including water and coffee home and office delivery services, water filtration services, and retail services, while creating cost synergies as well as portfolio expansion. In addition, the acquisition is expected to broaden the distribution platform of Cott by adding a national direct-to-consumer distribution channel with the 2,100 customer routes operated by DSS. Upon closing the transaction, Cott will have pro forma net sales and adjusted EBITDA of approximately $3 billion and over $350 million, respectively, for the twelve months ended September 27, 2014.

Jerry Fowden (pictured), chief executive of Cott, comments: “The DSS acquisition substantially accelerates our diversification strategy, bringing a strong home and office water and coffee beverage platform and direct-to-customer delivery network into our portfolio. DSS is a market leader in the growing water and coffee services industries. It has established a scaled national direct-to-customer network and is led by an experienced senior management team. This acquisition meets all of the criteria established within our disciplined acquisition guidelines, including acquiring businesses within growing categories and with higher margins while enhancing product, package and channel diversification. Following this acquisition, Cott will have a more growth oriented, higher margin business and a more balanced revenue and earnings base.”

CottJerry Fowden adds: “This is a transformative milestone for Cott. DSS will assist our continued efforts to migrate from a primarily CSD and shelf stable juice beverage business to a diversified beverage provider with a strong platform on which to grow. We believe this acquisition will provide us with the resources and scale necessary to drive our future success and build shareholder value.”

Cott is one of the world’s largest producers of beverages on behalf of retailers, brand owners and distributors. Cott produces multiple types of beverages in a variety of packaging formats and sizes, including carbonated soft drinks, 100% shelf stable juice and juice-based products, clear, still and sparkling flavored waters, energy drinks and shots, sports drinks, new age beverages, ready-to-drink teas, beverage concentrates, liquid enhancers, freezables and ready-to-drink alcoholic beverages, as well as hot chocolate, coffee, malt drinks, creamers/whiteners and cereals. With over 4,000 employees, Cott operates manufacturing facilities in the United States, Canada, the United Kingdom and Mexico. Cott also develops and manufactures beverage concentrates which it exports to approximately 50 countries around the world.

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