Trading in Dr Pepper Snapple shares opened

Source: Exec

Date :08/05/2008 02:22:25

Dr Pepper Snapple Group Inc., the US beverage company, was listed on the New York Stock Exchange yesterday, marking its official separation from Cadbury Schweppes Plc.

Shares changed hands on its Wall Street launch at about $25 each, less than the expected $30 a share. The share price values the new US group at about $6.4 billion.

Prospects

According to Beverage Digest, Coke has 43 percent of the US carbonated soft drink market in 2007, Pepsi had 31 percent, whilst Dr Pepper came in a distant third with 15 percent.

For each of the past four years, the company has been the only major beverage business with year-over-year market share growth in the carbonated soft drinks segment. Analysts have predicted that Dr Pepper Snapple (DPS) may need to increase its prices again this year to cover higher costs, although this would put more market share in jeopardy.

President and Chief Executive of DPS, Larry Young, said, “We have a strong and sustainable business model and can leverage our integrated system for future growth. We have confidence in the beverage industry and we are looking forward to seizing the opportunities as a stand-alone company.”

In addition to its Dr Pepper and Snapple brands, the DPS portfolio includes 7UP, Sunkist Soda, Hawaiian Punch, Canada Dry and Schweppes.

May 08, 2008