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Cott to purchase Crystal Rock
Posted on Tuesday, 13 February 2018 13:19
Canadian beverage company Cott, through its indirect subsidiary CR Merger Sub, is buying US mineral water and coffee wholesaler Crystal Rock for around USD 35.00 million in cash.
The takeover bid of USD 0.97 per share represents a 22.8 per cent premium over the target’s closing price of USD 0.79 on 9th February 2018, the last trading day prior to the announcement.
Completion is slated for March 2018, subject to certain closing conditions.
New York Stock Exchange-listed Crystal Rock markets and distributes water and coffee services, office supplies, refreshment beverages and other break room items to commercial office and at-home markets across New York and New England.
Founded in 1914, the firm, which describes itself as the largest independent delivery provider of its kind in the US, had a market capitalisation of USD 16.87 million as at 9th February 2018.
For the year ending 31st October 2017, it reported net income of USD 560,000 (2016: USD 1.20 million) and revenue totalling USD 59.07 million (2016: USD 65.34 million).
The declining results can be attributed to reduced sales volumes and higher selling costs during the 12 months; however, these expenses were due to investments made in customer-facing technology that the firm expects will improve online ordering capabilities in the future.
Cott also delivers bottled water to offices and homes, but additionally roasts coffee and blends iced teas for food service and convenience stores in the US through S&D Coffee and Tea, which it purchased in 2016 for USD 355.00 million.
The acquiror had a market capitalisation of USD 2.12 billion as at 9th February 2018, and claims to reach more than 2.30 million customers or delivery points in North America and Europe.
It reported a USD 18.50 million loss and revenue of USD 1.70 billion for the nine months ending 30th September 2017.
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