Cott selling beverage manufacturing business in $1.25 billion deal

In a move to exit the traditional beverage business, Canada-based beverage supplier Cott Corporation is selling its traditional beverage manufacturing business to Refresco Corporation for US$1.25 billion.

Cott will add 29 production sites to Refresco’s network, with 19 in the U.S., four in Canada, one in Mexico, and five in Britain.

Mississauga, Ont.-based Cott Beverages division is said to be one of the world’s largest producers of drinks on behalf of retailers, brand owners, and distributors.

In a statement, Cott said the sale will help position it to better grow its water, coffee, tea and filtration businesses both organically and with acquisitions.

“After a thorough strategic review in 2013, we developed an accelerated diversification and acquisition strategy in order to transform our company and create a business weighted towards better for you products in categories with topline growth, a more diverse channel and customer base, higher margins, and strong free cash flow generation,” Cott Corporation CEO Jerry Fowden said in a statement. “This transaction is very much in line with this strategy, and enables our traditional business to become an integral part of a larger global beverage manufacturing company that pursues the same high customer service and quality standards Cott has been known for throughout its history.”

Headquartered in Rotterdam, The Netherlands, Refresco is a leading independent bottler of soft drinks and fruit juices for retailers, with production in Benelux, Finland, France, Germany, Italy, Poland, Spain, the UK, and the U.S.