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Hansen Natural is to pay more than $100 million in early termination fees in order for Coca-Cola Co.

Hansen Natural is to pay more than $100 million in early termination fees in order for Coca-Cola Co. and its main bottler Coca-Cola Enterprises (CCE) to take over distribution of its Monster Energy drink in several major markets. And confounding rumors to the contrary, CCE has also renewed an agreement to distribute the Rockstar energy drink brand until the end of next year. Both deals were announced October 6. The first, which was largely expected, will see CCE assume distribution of Monster Energy in selected U.S. regions and six countries in Western Europe (UK, France, Belgium, the Netherlands, Luxembourg and Monaco) from November 1 and in Canada from early next year. Anheuser-Busch will continue to distribute the energy drink in the on-premise channel across the United States and Hansen can also extend distribution to Coca-Cola bottlers in other regions not cover by CCE, it said. The deal with CCE covers all Monster Energy trademarks, including Java Monster and Lost and is expected to span the next 20 years. To exit its current distribution contracts, Hansen said it would take a hit of somewhere in the region of $110-130 million from termination fees, which will be largely covered by non-refundable contribution from CCE.
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Title Annotation:BUSINESS BRIEFS ...
Publication:Food & Drink Weekly
Date:Oct 6, 2008
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