ZURICH, SWITZERLAND — Nestle S.A. and The Coca-Cola Co. have reached an agreement to end their ready-to-drink (R.-T.-D.) tea joint venture. Created in 1991 as Coca-Cola-Nestle Refreshments Co. S.A. and renamed in 2001 as Beverage Partners Worldwide (B.P.W.), the joint venture will dissolve on Jan. 1, 2018.
“The ready-to-drink tea market has evolved, and Nestle believes the time is right to develop Nestea independently,” Nestle said.
B.P.W. offers R.-T.-D. tea, in particular Nestea, in Canada and Europe.
As part of the agreement to dissolve, Nestle said it is granting The Coca-Cola Co. a license to manufacture and distribute Nestea in Canada, Spain, Portugal, Andorra, Romania, Hungary and Bulgaria. In other countries that are currently part of the joint venture, The Coca-Cola Co. will no longer produce or distribute Nestea.
Nestle said it currently manages the Nestea brand in several countries, including the United States, through its Nestle Waters division. Under terms of the new agreement, Nestle Waters also will manage Nestea in all the European countries that are not concerned by the licensing agreements.
Ten years ago, Nestle and The Coca-Cola Co. agreed to refocus the activities of B.P.W. on R.-T.-D. black tea beverages. At that time, the companies said they believed a concentrated focus on black tea beverages would accelerate the growth and bolster the market presence of B.P.W.Just last month, Nestle unveiled plans to revamp the Nestea tea brand. The initiative, which includes new reformulations and a premium product line, is geared toward enhancing Nestea’s position in the rapidly expanding $4.5 billion ready-to-drink tea category.