CADBURY SCHWEPPES BUYS THE HAWAIIAN PUNCH BRAND FOR $203 MILLION FROM PROCTER & GAMBLE

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CADBURY SCHWEPPES BUYS THE HAWAIIAN PUNCH BRAND FOR $203 MILLION FROM PROCTER & GAMBLE
15 Apr 99

Cadbury Schweppes plc announced today that it has agreed to purchase Hawaiian Punch, America's leading fruit punch brand, from The Procter & Gamble Company for $203 million (£126m). The transaction is subject to regulatory review and expected to be completed by 30 May 1999.

The Brand

Hawaiian Punch is a juice-based non-carbonated soft drink which has developed a strong consumer appeal over 60 years and has clear market leadership in the non- carbonated tropical flavour drink sector. Available primarily in the US, it is sold in both the soft drink and juice sectors in retail outlets. The brand is targeted mainly at the pre-teen and teenage markets and has grown consistently for several years.

Manufacturing and Distribution

Hawaiian Punch will be managed by Dr Pepper/Seven Up (DPSU) but manufactured and distributed by both DPSU and Mott's.

As part of the transaction, The Procter & Gamble Company has agreed to assist with manufacturing and other services on a transitional basis until the brand is fully transferred to DPSU and Mott's plants. It is expected that the transfer will be completed within six months after closing. The acquisition does not include employees, manufacturing facilities or equipment.

Distribution of the brand to the soft drink sector will be effected through Dr Pepper/Seven Up bottler networks. This accounts for nearly 70% of the total volume. Hawaiian Punch is sold in bottle, can and fountain formats. The brand adds approximately 37 million 12oz cases to DPSU's other leading flavour brands and, in overall volume, ranks alongside Sunkist or Schweppes.

The remaining 30% sold in the juice sector (17 million cases) will be distributed by Mott's through their broker and warehouse network. It will be sold alongside Mott's Apple Juice and other juice flavours, liquid concentrates and Roses Lime Juice. The brand adds a number of major juice category SKUs (stock keeping units) which will significantly strengthen Mott's critical mass with its brokers and retail trade customers.

Financial Data

The consideration of $203 million will be funded by an increase in USD borrowings. Net sales for Hawaiian Punch were $133.3 million for the year ended 30 June 1998. The transaction is structured as an asset purchase, which qualifies for tax amortisation treatment. The brand value will be retained on Cadbury Schweppes' balance sheet. The acquisition is earnings neutral in 1999 and enhancing thereafter.

John Sunderland, Chief Executive of Cadbury Schweppes, commented "The acquisition of Hawaiian Punch emphasises our commitment to the important US soft drink market. It is a value-enhancing addition to the portfolios of our US beverages operations and furthers our strategy of building strong brands and businesses".

"We're very pleased with this outcome", said Stephen P. Donovan, President of P&G's North American food and beverage business. "Consumers will still be able to buy Hawaiian Punch through Cadbury Schweppes. We will continue to focus our resources on building and globalising our food and beverage brands, and developing new businesses".

Cadbury Schweppes plc: Tel: 0207-409-1313 http://www.cadburyschweppes.com



for further information contact: media enquiries

Dora McCabe
Head of Group Public Relations
Tel: +44 (0)20 7830 5127
Fax: +44 (0)20 7830 5137
contact Dora McCabe

general enquiries

Sebastian Lund
The Procter & Gamble Co,
Cincinnati,
US
Tel: 001-513-945-8468

investor enquiries

Sally Jones
Investor Relations Director/Finance Director Global Commercial
Tel: +44 (0)20 7409 5124
Fax: +44 (0)20 7830 5157
contact Sally Jones

David Kappler
Chief Financial Officer
Tel: +44 (0)20 7409 1313

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