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

Weekend Best Bets

Shhh.... The Dog Whisperer is coming to town. Plus, the Ballet, a bird fair and more!

Holiday Gifts -- Toys

Here are the Top 10 hottest toys your children will be asking for this holiday.

One-tank trip

From the Biltmore estate to new breweries, Asheville is the perfect weekend getaway.

Atlanta Holiday Guide

Check out these tables settings to spruce up your holiday dinner and parties.

"Wonderful Life" Quiz

What did George wish for when he entered the drug store? Test your knowledge.

My Style: Tana Heaton

This Fayetteville grandmother mixes old with new and is no stranger to designer shoes.

Cookie of the day

Chocolate-tipped butter cookies premieres today in our baker's dozen of goodies.

Job search resources

More than 25 tips and resources to help you find employment.

Movie openings

"Cadillac Records" sings a familiar tune led by Beyonce portraying Etta James.

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