Coke's Glaceau buyout plans get fizzy

Global soft drink giant Coca-Cola has made a pre-merger filing with the US anti-trust regulators regarding a possible acquisition of energy drink maker Glaceau, in which the Tata Group holds a 30% sake, media reports said here.

Coca-Cola has filed a pre-merger Hart-Scott-Rodino Act (HSR) notification with the Federal Trade Commission, trade publication Beverage Digest reported.

The filing is necessary for deals of significant size under anti-trust regulatory framework, which seeks to prevent mergers and acquisitions that could reduce competition, lead to higher prices, lower quality of goods or services, and/or decrease innovation.

Citing unnamed sources in its special edition published yesterday, the magazine said that the HSR filing triggers a review of any possible anti-trust implications of the proposed deal.

It could mean several things ranging from Coke having an agreement to acquire Glaceau to Coke having a non-binding letter of intent for such a deal, the report said.

The report quoted sources as saying that the FTC only begins its review process when the major deal points are agreed upon, at least in principle, but a deal could be and was likely, still subject to Coca-Cola board approval.

While it was not known when Coke filed the HSR notification with the FTC, a review process normally takes 30 days.

However, it could be shorter or longer in certain cases.

Glaceau, in which Tata Tea had acquired a 30% stake for $677 million in August last year, was reported to be on Coke's takeover radar earlier last month.

When contacted, a Tata Tea spokesperson in India said: "We do not wish to comment on speculation".