The renewal will extend the three-year-old deal between CCE and the independent energy drink company until at least the end of 2009 — and possibly beyond — according to Rockstar.
The extension, which covers the U.S. and Canada, comes at a time when several news organizations and financial analysts were reporting that a distribution deal between Coke and Rockstar rival Hansen’s Beverage Co., the maker of Monster Energy Drink, was about to be signed.
While it appears that the extension would not preclude Coke signing up Hansen’s as well — or taking an equity stake, as some have suggested — it does allow Rockstar some extra weight by allowing the company to terminate the agreement before the end of the contract.
According to a Rockstar representative, there’s also an additional provision that gives Rockstar the ability to remove territories from the Coke system by giving 30 days notice. The goal, of course, being to put extra and ongoing pressure on Coke to perform with the Rockstar brand.
The release also pointed to ongoing negotiations between Rockstar and Coke for “certain portions of their territories after 2009.” While that may point to an eventual possible reduction in Coke’s dealings with Rockstar, the deal is nevertheless likely to surprise industry watchers, who had all but written the Coke/Hansen’s deal as a fait accomplis.
Given today’s NACS conference, there’s a great deal to this story that will be unfolding in the coming weeks.