Coke to acquire Glaceau

Mumbai, May 25 (UNI) Soft drink major Coca-cola will acquire New york based vitamin water producer Glaceau, in which Indian tea maker Tata Tea Limited has 30 percent stake.

The deal is expected to be sealed for an amount of USD 4.1 billion in cash.

Tata Tea Limited today informed Bombay stock exchange(BSE) that it has agreed to sell its stakes to coca-cola for an approximate consideration of USD 1.2 billion.

Glaceau, also known as Energy Brands Inc USA (EBI), which was formed in 1996 and based in Whitestone, is the second largest producer of Vitamin water, Fruitwater, Smartwater and Vitaminenergy after Pepsico Inc's Propel.

Tata Tea Limited, through its indirect UK subsidiary Tata Tea Investments Ltd, had acquired 25 percent stakes in Glaceau while Tata Sons Limited through its subsidiary Tata Ltd (UK) acquired 5 percent stakes of Glaceau.

The aggregate consideration for the purchase of the 30 percent holding was USD 677 million based on an enterprise valuation of USD 2.2 Billion of Glaceau, Tata tea informed BSE.

The Indian tea major also informed BSE that in response to an offer received from Coca Cola Company for acquiring 100 percent of the capital of Glaceau, the company has conditionally agreed to sell their shares to Coke by the end of the year for an approximate consideration of USD 1.2 billion.

The acqusition is expected to step-up Coca-Cola's earnings per share in the ensuing months.

Reacting to the development, the shares of Tata tea limited today went up by Rs 34.95 to close at Rs 913.65 from the previous close of Rs 878.70 in the bourses.

UNI