Glaceau to source tea extracts for water

Glaceau will start sourcing tea ingredients for its enhanced water brands- Rescue and Vital-T. Tata Tea acquired 30 per cent stake in the company last week.

Rescue, the green tea-based vitamin water, is among the top five variants of enhanced water brands of Glaceau. "Henceforth, we will source the teas from Tata Tea," said J Darius Bikoff, founder and CEO, Glaceau.

Bikoff said that the company had no immediate plans to manufacture the brands in India. "We would like to keep manufacturing close to the market. Otherwise it will not be cost effective," Bikoff said.

He also said that Glaceau's near term focus would be the US market due to its untapped potential. But he did not rule out an expansion in the UK or other markets.

"We are considering other countries as well and have just started exporting to the Caribbean islands," said Bikoff. Glaceau is likely to use the Tata Tea Great Britain platform and expand in the UK and central Europe markets.

Glaceau has been growing at a CAGR of 200 per cent over the last few years and is looking at crossing $1 billion in revenues soon. "We don't see any reason why we won't be as big as Gatorade (Pepsi's energy drink is a $3-billion brand) over the next 3-5 years," said Bikoff.

Bikoff is keen on getting a larger share of the $100-billion beverage market in the US where soft drinks hold $80 billion and the remaining is equally split between bottled water and others (enhanced water, energy drinks and so on).

"People are increasingly getting health conscious and the consumer today is far more sophisticated that ever before. Currently, we sell 5 million bottles a day," he said.

Tata Sons and Tata Tea jointly invested $677 million in Glacéau for 30 per cent stake in the company.The funds would be used to increase the reach of the brand and its presence in the US.