Dr Pepper Snapple Group signs agreements with Coca-Cola

PLANO, Texas Dr Pepper Snapple Group has entered licensing agreements with Coca-Cola, which are subject to Coca-Cola's completed acquisition of Coca-Cola Enterprises' North American bottling business.

Under new licensing agreements, Coca-Cola will distribute Dr Pepper in the United States and Canada Dry in the northeasten United States. where they currently are distributed by CCE. Coca-Cola also will continue to distribute Canada Dry, C'Plus and Schweppes in Canada. Additionally, in certain U.S. territories where it has a manufacturing and distribution footprint, DPSG will begin selling Squirt, Canada Dry, Schweppes and Cactus Cooler, which currently are sold by CCE.

The new agreements will have an initial term of 20 years, with 20-year renewal periods, and will require Coca-Cola to meet certain performance conditions. As part of these transactions, DPSG will receive a one-time cash payment of $715 million before taxes, fees and other related expenses.

"These agreements build a strong foundation for the continued growth of Dr Pepper and our leading flavor brands," said Larry Young, president and CEO of DPS. "It solidifies Coke's support of the Dr Pepper trademark, while enabling us to optimize our route-to-market by assuming distribution of several key brands.  Additionally, we're increasing our fountain presence, enabling millions of consumers to sample our brands each day -- a great win for Dr Pepper."