Coca-Cola to buy 16.7% stake in Monster Beverage

Reuters | 15 August 2014, 1:45 PM IST

NEW YORK: Cola Co. said Thursday that it is buying a 16.7 percent stake in Monster Beverage Corp and will have two directors on Monster's board as the beverage company seeks to expand into faster-growing categories like energy drinks.

Under the agreement, Coke will make a cash payment of $2.15 billion and transfer ownership of its worldwide energy business including NOS, Full Throttle and Burn, to Monster. Monster will issue to Coke shares of common stock, and transfer its non-energy business, which includes Hansen's Natural Sodas and Peace Tea, to Coke. Coke will become Monster's preferred distribution partner globally, while Monster will become Coke's exclusive energy drinks partner.

The transaction is expected to close late in 2014 or early in 2015.

"Our equity investment in Monster is a capital-efficient way to bolster our participation in the fast-growing and attractive global energy drinks category," said Coke Chief Executive Officer Muhtar Kent.

source

FMCG majors like GSK, Coca-Cola India and others join hands to push FSSAI on speedy approvals

By Ratna Bhushan | 14 August 2014, 8:20 AM IST


NEW DELHI: The heads of a bunch of food companies met the food safety regulator last week, in what seemed like high-level lobbying aimed at settling issues that delay product approvals and lead to skirmishes between the firms and authorities.

GlaxoSmithKline Consumer Healthcare managing director Zubair Ahmed, Coca-Cola India President Venkatesh Kini, Kellogg MD Sangeeta Pendurkar, Cargill India MD Siraj Chaudhry, Mother Dairy MD S Nagarajan, Ferrero Group India head Luigi Oddone and McCain Foods MD Vikas Mittal were part of the delegation that met Food Safety and Standards Authority of India (FSSAI) chairman K Chandramouli and other officials.

The meeting that saw so many heads of companies coming together indicates the importance of product approvals for these companies at a time when they are seeing signs of a turnaround in the market after a two-year slump.

The meeting was kept under wraps until now, with the companies unwilling to discuss the topic on record because of the sensitivity of matters over food regulations and product approvals. Chandramouli confirmed the meeting.

"It was an exchange of ideas and information ... everyone of them had suggestions and points of view. I had not met many of the CEOs earlier, so they came to meet me. Product approval was one of the issues discussed," he told ET.

Usually, the corporate affairs representatives of these firms meet FSSAI officials to settle issues.

"We are implementing the food safety standards on a huge scale for the first time in the country. It is a big challenge and there are also litigations, but ultimately, it is for the benefit of the consumer," he said, explaining the reasons for delayed approvals.

One of the officials with direct knowledge of the discussions said while various aspects were discussed, emphasis was on allowing the companies to quickly take their new products to the market.

"The India heads also wanted to assure FSSAI that they are aligned with the food regulator in addressing food safety and quality," this person said.

"There's an urgent need for quick approvals at a time when product innovation gives a huge competitive edge," another official said. "A lot of investment goes in research and development, which companies want to fast track, but are stuck at the regulator because clearances are taking too long."

The relationship between food and drug firms and FSSAI hasn't always been smooth, with frequent conflicts over new product approval as well as imports and new labelling rules.

In April this year, FSSAI blocked a consignment of syrups meant for Tata Starbucks, which led the coffee chain to approach the Bombay High Court for relief.


Last year, on the eve of Diwali, consignments of leading gourmet chocolate importers such as Mars, Godiva, Guylian and Lindt were stopped by the regulator.


FSSAI had said the imported products didn't contain India-specific labeling, and that the importers had merely pasted local stickers on products that were supposed to sell in overseas markets.

Maharashtra-based Vital Nutraceuticals and the Indian Drug Manufacturers Association had filed a petition saying that FSSAI didn't have the power or authority to issue advisories as it amounted to amending regulations framed under the Food Safety and Standards Act, 2006.
read more