Premium mixer brand Fever-Tree has announced a strategic partnership with beverage giant Molson Coors, marking a significant development in its US expansion strategy.
The partnership grants Molson Coors exclusive rights for sales, distribution, and production of Fever-Tree products across the United States.
Fever-Tree has established itself as America’s leading tonic and ginger beer brand since entering the market in 2008. Under the new agreement, Fever-Tree will leverage Molson Coors’ extensive national distribution network and commercial infrastructure to accelerate its growth in both the on-trade and off-trade sectors.
As part of the agreement, Molson Coors will acquire an 8.5 per cent stake in Fever-Tree for £71.0 million, representing a price of 654.2 pence per share.
Fever-Tree plans to return these proceeds to shareholders through a share buyback programme, scheduled to commence in February 2025. Fever-Tree investors were in desperate need of some good news after years of spluttering sales growth and declines for the shares. Today’s announcement offers a glimmer of hope.
The partnership includes substantial marketing investment and plans to establish local US production facilities, utilising Molson Coors’ supply chain expertise. This move is expected to generate significant operational efficiencies for Fever-Tree’s American operations.
“Today’s announcement marks a transformational step for the Fever-Tree brand in the US. Thanks to the superb work of our US team, we have seen Fever-Tree become the number one brand in both the tonic and ginger beer categories, a remarkable achievement which has redefined the US mixer category amongst consumers and customers alike,” said Tim Warrillow, co-founder and CEO of Fever-Tree.
“But what is so exciting is that as the Fever-Tree brand has grown in the US, so has the opportunity ahead of us, reflecting the increasing number of categories and occasions that our products are relevant to.”