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Issue Date: Vol. 50, No. 10, October 2010, Posted On: 10/11/2010

DPS Completes Coca-Cola Licensing Deal

Emily Jed
Dr Pepper Snapple Group Inc., Coca-Cola Co., Coca-Cola Enterprises, b beverage industry, beverage vending, vending machine business

PLANO, TX -- Dr Pepper Snapple Group Inc. has completed the licensing of certain brands to Coca-Cola Co. following its acquisition of Coca-Cola Enterprises' North American bottling business. As part of the transaction, DPS received a one-time cash payment of $715 million. [see story]

Under the new licensing agreements, Coca-Cola will distribute Dr Pepper in the U.S. and Canada Dry in the Northeast, where the brands were formerly distributed by CCE. In addition, Coca-Cola will offer Dr Pepper and Diet Dr Pepper as the only non-Coke brands dispensed through its high-tech Freestyle touchscreen fountain dispenser. It will also offer Dr Pepper drinks in local fountain accounts formerly serviced by CCE.

The new agreements have an initial term of 20 years, with 20-year renewal periods, and require Coca-Cola to meet certain performance conditions.

Coca-Cola will continue to distribute Canada Dry, C'Plus and Schweppes in Canada. Additionally, in certain U.S. territories where it has a manufacturing and distribution footprint, DPS will begin selling Squirt, Canada Dry, Schweppes and Cactus Cooler, which were formerly sold by CCE.

"These agreements solidify Coke's support of the Dr Pepper trademark and the continued growth of both the brand and our flavor portfolio," said DPS president and chief executive Larry Young. "Moreover, it increases the brand's presence on fountain, providing additional opportunities for millions of consumers to sample the brand each and every day."

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