Company Press Release
SOURCE: Ocean Spray
Riding Wave of Marketplace Momentum, Ocean Spray Rejects Potential Transaction
LAKEVILLE, Mass., Nov. 19 /PRNewswire/ -- Riding a wave of renewed popularity in its brand, Ocean Spray Cranberries, Inc. has decided not to pursue the idea of selling all or part of its company in favor of building a stronger grower-owned organization to better compete in a world of food and beverage giants.
``Over the last 70 years, we have created an incredible brand and category that stands for health and refreshment,'' said chairman Don Hatton. ``We believe we can continue growing our brand and ensuring the financial health of our grower-owners by revitalizing the organization.''
The 25-member Board of Directors, which represents the company's 900 grower-owners, voted to remain a cooperative after reviewing the findings of a six-month business analysis that involved the Board, management and outside advisors, Merrill Lynch and Bain & Co.
Ocean Spray commands an industry-leading 50 percent share of the cranberry juice category and is often credited with creating the grocery juice aisle. But poor grower returns caused by record surpluses and slippage in Ocean Spray's market share have created intense pressure on the Board and management to improve grower-owner profitability.
Ocean Spray's marketing plans have begun to yield success with volume trends up sharply for 20 consecutive weeks. This success is building on the strength of two significant product launches: a new line of Premium 100% Juices and Cranberry Juice Cocktail PLUS, both of which contain 130 percent of the recommended dietary allowance (RDA) of vitamin C. Cranberry Juice Cocktail PLUS also contains calcium and vitamins A and E. While these changes will not impact owner profitability in the short-term, they have created renewed confidence among employees and shareholders.
``The food and beverage industry is experiencing intense consolidation, but our analysis convinced us that Ocean Spray can compete in this industry if we make the necessary changes,'' said Hatton. ``Our grower-owners take great pride in owning this company and want to continue controlling their destiny,'' he said.
The Board currently is in the final stages of a search for a new Chief Executive Officer and will form a Strategic Committee to advise the new CEO regarding future business plans to improve financial health for growers and realize the untapped value of the Ocean Spray brand.
Ocean Spray is an agricultural cooperative owned by 750 cranberry growers and 150 citrus growers throughout the United States and Canada. Ocean Spray has been the best-selling brand name in the canned and bottled-juice category since 1981, with sales of $1.48 billion in 1998. Headquartered in Lakeville-Middleboro, Mass., Ocean Spray employs more than 2,000 people worldwide. For additional information about Ocean Spray Cranberries, Inc. visit its web site at http://www.oceanspray.com .