Cadbury, the maker of Dr Pepper and 7Up, will pay $1.03 billion for Snapple, the Mistic brand of tea and fruit drinks, and Stewart's root beer, the executives said. Cadbury will also assume $420 million in debt. Cadbury acquired Dr Pepper Bottling Holdings Inc. of Irving in September 1999.
The deal is something of a reversal for Triarc, which said in June that it would spin off part of its beverage division. That spinoff would have included the Royal Crown brands in addition to Snapple and Mistic.
But executives said Sunday that in looking at the plan to take the unit public, Triarc saw more value in an outright sale. In any event, analysts had expected the stand-alone company to be a takeover candidate.
The transaction could also signal a turnaround for Snapple. The company, which was a Long Island, N.Y., success story and a Wall Street darling, was bought by Quaker Oats in 1994 for $1.7 billion but proved to be an immediate drag on the company.
In 1997, Quaker closed the books on what some analysts called the worst acquisition in memory by selling Snapple to Triarc for only $300 million. Triarc is now profiting on that investment.
A purchase by Cadbury would be the latest in a recent buying wave. Last week, Cadbury said it would buy Pepsi Cola Bottlers Australia to increase its market share in carbonated soft drinks.
Last month, Dr Pepper/Seven Up Bottling Group, Cadbury's U.S. unit, bought Grant-Lydick Beverages Co., a South Texas bottler, for an undisclosed sum.