- Water and filtration company, Cott Corporation (TSX:BCB) has sold S&D Coffee and Tea to the Westrock Coffee Company
- The sale was valued at C$405 million and is part of Cott’s move toward being a pure-play water company
- Toward that end, Cott acquired Primo Water for a share buy-out valued at $775 million
- As a result of the acquisition, Cott Corporation will change its name to Primo Water Corporation
- Cott Corporation (BCB) was up 2.73 per cent, with shares trading for $19.59 and a market cap of $2.6 billion
Water and filtration company, Cott Corporation (TSX:BCB) has sold S&D Coffee and Tea to fund its acquisition of Primo Water.
Cott announced earlier this year that it was considering alternatives to its coffee and tea operations that would better align with growth.
As a result of this financial enquiry, the company decided to sell the assets and instead focus entirely on water as its main commodity.
Three weeks later, Cott announced that Westrock Coffee has offered to purchase S&D for C$405 million.
Tom Harrington, CEO of Cott Corporation, thanked all the management and team members at S&D Coffee and Tea for their efforts over the years.
“We will use the proceeds from the sale of S&D to complete the acquisition of Primo Water Corporation as we transition to becoming a leading pure-play water solutions provider.
“These transactions position us to accelerate top and bottom-line growth as well as margin expansion across our business,” he said.
Primo Water supplies bottled water and filtration throughout the U.S. and Canada. Primo generated $300 million in revenue last year and is a substantial acquisition by Cott Corporation.
Cott purchased all outstanding shares of Primo Water at $14.00 for a sum consideration of $775 million. Consequently, Cott Corporation will now change its name to Primo Water and trade on the TSX under the ticker code PRMW
“We firmly believe that our combined businesses will drive significant value for our shareholders over the coming years,” Harrington added.
Cott Corporation (BCB) was up 2.73 per cent, with shares trading for $19.59 at 2.18pm EST.
