Coke signs deal to distribute Monster Energy drinks

The Atlanta Journal-Constitution

Monday, October 06, 2008

Coca-Cola Co. and its largest bottler have struck a 20-year deal to distribute the nation’s top energy drink in parts of the United States and elsewhere, the companies said Monday.

Coca-Cola and Coca-Cola Enterprises, both of Atlanta, have agreed to distribute California-based Hansen Natural Corp.’s line of Monster Energy drinks in parts of about 20 states and six western Europe countries in November and in Canada early next year.

Enlarge this image

File photo

ENERGY DRINK MARKET SHARE
  • Monster: 29.2%
  • Red Bull: 25.2%
  • Rockstar: 14.2%
  • AMP: 8.6%
  • Full Throttle: 6.7%
  • SoBe: 4.7%
  • NOS: 3.0%

as of June 30

Source: Beverage Digest



COCA-COLA NEWS
Latest Headlines:
Photos: Coke pours a lot into China Games
More Coke photo galleries
More Coke news

Monster is the top U.S. energy drink in terms of volume, followed by Red Bull.

The deal, which includes selling Java Monster and the Lost Energy brands, could add between $20 million to $25 million to CCE’s 2009 operating profits, or 3 to 6 cents a share, beverage analyst John Faucher wrote in a research note Monday. It is likely to have “a slightly positive impact on (Coca-Cola) in 2009,” wrote Faucher, an analyst for J.P. Morgan.

CCE may “eventually get the opportunity to manufacture Monster,” he also wrote.

Hansen was using Dr Pepper Snapple Group, a Plano, Texas-based beverage firm, and a patchwork of other distributors to sell the Monster line in the areas that Coca-Cola will now serve.

Coca-Cola and CCE will be selling about half of Hansen’s volume of Monster, according to analyst reports. Anheuser-Busch will distribute most of the rest. Dr Pepper Snapple will keep a small portion.

Coca-Cola and Hansen have been discussing having the Coca-Cola system handle Monster for at least some parts of the United States for about a month, said John Sicher, editor and publisher of Beverage Digest, which tracks the industry.

“The energy drink business has been a strong provider of growth for some years now,” Sicher said. “So Coke now gets access to one of the best brands in the category in a large part of the United States.”

Hansen said the new agreement with Coca-Cola will “complement our existing long-term arrangements with Anheuser-Busch distributors,” Rodney Sacks, chairman and chief executive officer of Hansen, said in a statement.

As part of the deal, Hansen can negotiate distribution agreements with other Coca-Cola bottlers that service areas not covered by CCE.

Coca-Cola North American and CCE signed a distribution agreement in 2005 with Rockstar, a Las Vegas-based energy drink company. Rockstar is a distant third in market share behind Monster and Red Bull.

Coca-Cola North America recently ended that agreement, Scott Williamson, a spokesman for Coca-Cola North America said. “Our agreement with Rockstar was terminated earlier this month by mutual consent of both parties,” Williamson said.

But CCE on Friday extended its deal with Rockstar through the end of 2009, CCE said. The deal, which Rockstar can terminate before it expires, covers distribution in the U.S. and Canada.

Coca-Cola also owns Full Throttle, another energy drink. PepsiCo’s energy drink lineup includes Amp Energy, SoBe Adrenaline Rush and No Fear.

Inside AJC.COM

Year in Review

Remembering Skip Caray, Bernie Mac, Isaac Hayes and those who passed away.

Atlanta Falcons

Can the surprising team make the playoffs? Here's what has to happen around the league.

Cookie of the day

We're rolling out a baker's dozen of holiday cookies. Get ready for a treat!

National Travel

Three ways to see Palm Springs: On a budget, moderate or splurge!

Top Music Downloads

iTunes' 2008 top-selling single. It is Rihanna, Coldplay, Lil' Wayne or Leona Lewis?

Atlanta Holiday Guide

More than 10 perfect dresses for the holiday parties you're attending this month.

Atlanta's Favorite Recipes

Here are 12 of the most clicked-on recipes by ajc.com readers, including baked ziti.

Private Quarters - Splurge

Former Braves catcher Javy Lopez and his wife Gina show us their Suwanee home.

Best of the Big A

See who's voted Best Liquor Store in Metro Atlanta. Plus nominate best drive-time DJ.

Search AJC Archives

1985 to present     1868 - 1939 Advanced search

Kudzu.com services Find the right people for the job

Keyword     Business Name

AJCPets » The community for Atlanta pet lovers

Do Good Search for non-profit causes near you