Beverage maker Dr Pepper Snapple Group Inc. (
) on Monday announced that is has entered into a licensing
agreement with The Coca-Cola Company (
) to distribute some of its products.
In pursuant to the deal, which is dependent on Coca-Cola's
acquisition of its main bottler Coca-Cola Enterprises (
) , KO will also offer Dr Pepper and Diet Dr Pepper in local
fountain accounts currently serviced by CCE.
Additionally, DPS will begin distributing certain Coke products
in some markets.
DPS will receive a one-time cash payment of $715 million as part
of the deal. Dr Pepper CEO Larry Young said in a statement that
"These agreements build a strong foundation for the continued
growth of Dr Pepper and our leading flavor brands … It solidifies
Coke's support of the Dr Pepper trademark while enabling us to
optimize our route-to-market by assuming distribution of several
key brands. Additionally, we're increasing our fountain presence,
enabling millions of consumers to sample our brands each day - a
great win for Dr Pepper."
Dr Pepper Snapple shares fell 19 cents, or -0.5%, while
Coca-Cola shares were mostly flat in premarket trading Monday.
The Bottom Line
Shares of DPS have a 2.74% dividend yield, based on Friday's
closing stock price of $36.49.
Shares of KO have a 3.43% dividend yield, based on Friday's closing
stock price of $51.27.
Dr Pepper Snapple Group Inc. (
) is not recommended at this time, holding a Dividend.com DARS™
Rating of 3.4 out of 5 stars. The Coca-Cola Company (
) is a "recommended" dividend stock, holding a Dividend.com DARS™
Rating of 3.5 out of 5 stars.
Be sure to visit our complete recommended list of the
Best Dividend Stocks
, as well as a detailed explanation of
our ratings system here