Ending months of waiting, the Coca-Cola Co. has finally purchased a majority stake in ZICO Coconut water, consummating a deal that has lingered in the final stages since the early Fall.
Independent shareholders of the brand began to receive checks for their stakes in the company earlier this week. Coke’s initial investment in the company, in 2009, was part of a combined $15 million round that divided a 20 percent stake between Coke’s Venturing and Emerging Brands group (VEB) and a group of entrepreneurs, distributors, and celebrities.
As with its purchase of Honest Tea in 2010, the rest of Coke’s investment was contingent on ZICO making certain sales goals.
“We’ve acquired an additional stake in ZICO,” confirmed Coca-Cola spokesman Scott Williamson in an e-mailed statement. “The additional stake validates the broad potential we’ve known ZICO had from the outset and is the natural progression for successful brands in which VEB has an interest. This further investment will allow our companies to continue to drive growth opportunities and expansion of the brand and the coconut water category.”
Although exact sales figures are not available for the company, sources have indicated that sales were in the range of $45 million last year; additionally, the company’s advertising agency, Ignited, notes that ZICO tripled sales from 2010 to 2011.
Founded by entrepreneur and international businessman Mark Rampolla in 2004, ZICO was one of the three original coconut water brands (the others are O.N.E. and Vita Coco). It was the second to receive financing from one of the beverage giants, pulling Coke on board soon after PepsiCo invested in O.N.E.
The company appears to have thrived with Coke as a partner, making a strong move into mainstream distribution via its move into an HDPE bottle and a from-concentrate format, although it continues to also sell a not-from-concentrate product as well. The company added a hot-selling chocolate flavor variety last year and also released a Latte line extension earlier this spring.
Rampolla was not available for comment as the news broke.