SELLING AN ICON
AriZona, the long-time, fiercely independent beverage company is no longer a two-man shop. And it might also signal the end of a friendship.
Co-Founder John Ferolito, the silent partner to better-known marketing whiz Don Vultaggio, has sold part or all of his holdings in Beverage Marketing USA, the company that makes AriZona, to private equity group Patriarch Partners LLC.
Meanwhile, the pair are also suing each other in New York. Neither side would comment on the ongoing actions in the Supreme Court of New York County, but large firm lawyers are currently representing both Ferolito and Vultaggio in the suit, which began earlier this year.
The sale is crucial to the future direction of AriZona, the leading RTD iced tea brand in the country, as Ferolito was an equal partner with Vultaggio. Vultaggio has expressed a strong desire to remain active in guiding the company, reportedly nixing the opportunity to sell out to a larger company on more than one occasion.
“This partnership brings tremendous opportunity to our company, our employees, distributors, retailers and stakeholders — all of whom have been integral to our long term success. Patriarch will enable us to move into the next phase of our company’s lifecycle with rapidity and success,” said John Ferolito in a release issued by Patriarch. “My partner Don Vultaggio and I started this company from an idea and vision and from that initial dream have grown it to become the successful enterprise it is today. Patriarch can help us accelerate our global business and to transform today’s company into the grand global business I know we can be.”MESSIN’ WITH THE BULL
Australian researchers discovered that Red Bull could be hazardous to your health – in a new way this time.
Just one can of sugar-free Red Bull, according to the researchers, can increase the risk of stroke or heart attack – even in young people – by making the blood sticky, a precursor to cardiovascular problems.
Scott Willoughby, lead researcher from the Cardiovascular Research Center at the Royal Adelaide Hospital, told an Australian Newspaper “One hour after they drank Red Bull, (their blood systems) were no longer normal. They were abnormal like we would expect in a patient with cardiovascular disease.”
Linda Rychter, spokeswoman for Red Bull Australia, said the company’s head office in Austria would assess the report.
“The study does not show effects which would go beyond that of drinking a cup of coffee. Therefore, the reported results were to be expected and lie within the normal physiological range,” she told Reuters.RTD TEA GETS A NEW PLAYER
Call it the tea wars.
PepsiCo made a move to keep up with the Coca-Cola Company’s investment in the fast-growing, high-end brand Honest Tea, announcing that it reached a licensing agreement with Lipton-owner Unilever to produce, manufacture and distribute Tazo RTD teas.
Pepsi currently distributes Lipton RTD teas – as well as its Brisk and Pure Leaf extensions – through the Pepsi/Lipton partnership. It also distributes Starbucks’ RTD beverages.
Tazo, like Lipton, produces a wide range of filter-bagged teas in addition to its RTD variant, currently sold at Starbucks and other locations. The brand’s partnership with Pepsi will bring another super-premium player to the $1.5 billion (and growing) RTD tea segment. The segment doubled over the past three years, and that growth largely benefitted emerging brands like Honest Tea and Sweet Leaf that bottled whole-leaf iced-teas.DSPG MAKES FRIENDS
The Dr Pepper Snapple Group recently formed agreements with HYDRIVE Energy LLC, Big Red and the Pepsi Bottling Group that will expand the company’s portfolio and distribution.
HYDRIVE produces low-sugar, low-calorie energy drinks in PET bottles, some of which incorporate functional benefits. Big Red produces CSDs including Big Red and Big Red Vanilla Float. DPSG currently distributes both brands in select areas, but the minority stake will give the company incentive to widen those products’ distribution maps, and also adds to the company’s portfolio of allied brands.
DPSG’s arrangement with PBG will put Orange Crush in the PBG distribution system, a move that suggests the bottler may be less-than-satisfied with PepsiCo’s own Tropicana Twister.
All three moves demonstrate the agility that company insiders hoped the Dr Pepper Snapple Group would demonstrate after its separation from Cadbury.