The Coca-Cola Co. has exercised its option to acquire the remaining 60 percent of Maryland-based organic bottled tea maker Honest Tea, reports The Atlanta Journal-Constitution. The companies described it Tuesday as a chance to make organic drinks more mainstream.
What they didn’t say is that it also may be a chance to invigorate Coca-Cola’s tea business, which lags behind PepsiCo’s. The deal completes a transaction that began three years ago, when Coca-Cola bought a 40 percent stake in Honest Tea.
According to the AJC, Honest Tea will operate as a stand-alone business under co-founder Seth Goldman and his management team.
Financial terms of the deal were not disclosed. Coca-Cola reportedly spent $43 million in its initial investment in Honest Tea, which had sales of $72 million last year.
Honest Tea, started in 1998 in Goldman’s home, has expanded its distribution from about 15,000 outlets in 2008 to more than 75,000.
