Cott to acquire Macaw for $135 million
August 10, 2005
by FoodBusinessNews.net Staff
TORONTO — Cott Corp. on Wednesday said it is acquiring privately held Macaw Soft Drinks Ltd. for approximately $135 million in a deal expected to lift earnings next year.
"The purchase of Macaw represents a significant strategic investment in our U.K. business," said John Sheppard, president and chief executive officer of Cott Corp. "The additional production capacity and Macaw’s manufacturing capability in the fast-growing aseptic beverage segment will allow us to expand the variety of products and packages we offer and enhance the service we provide to our customers."
Buying up soft-drink maker Macaw significantly expands the company’s business in Britain and should boost annual sales by about $100 million, Cott said, adding that the deal should be neutral to earnings this year but accretive in 2006.
Toronto-based Cott said it will finance the acquisition using about $150 million from its credit facility, which was increased to $225 million from $100 million in connection with the transaction.
Annual sales are now forecast to grow by 8% to 10% to a range of $1.78 billion to $1.81 billion, up from previous targets of $1.74 billion to $1.77 billion. Cott maintained an earnings estimate of $1.06 to $1.11 per share.
On average, analysts surveyed by Thomson Financial are predicting yearly income of $1.03 per share and sales of $1.76 billion. The company earned $1.09 per share and had sales of $1.65 billion in 2004.
For 2006, analysts see income of $1.25 per share and sales of $1.88 billion.