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SodaStream & Del Monte Join Forces

Zacks Equity Research

Leading manufacturer of home beverage carbonation system, SodaStream International Ltd. (SODA) recently partnered with Del Monte, a well-established brand of Fresh Del Monte Produce Inc. (FDP).

Under the alliance, SodaStream will produce, market, distribute and sell several Del Monte branded syrup flavors that can be used on its popular soda-making machines to make carbonated beverages. At a nascent stage, the company will offer fruity flavored options like Tropical, Caribbean and Orange.

 Though the financial terms of the deal were not disclosed, both the companies have agreed to launch the products during summer 2014 in Italy and the U.K.

Fresh Del Monte is engaged in manufacturing and supplying fresh produce including fruits and vegetables and other products like juices, beverages, snacks and desserts across Europe, Middle East and Africa. The company, which operates under the brand name Del Monte, boasts a solid presence in the market since 1886. Following this tie-up, Del Monte will step into the market of homemade sparkling drinks.

The partnership with SodaStream will facilitate both the companies to reach out more extensively to the growing number of consumers who prefer carbonated beverages. Soda-making systems offer a healthier way to enjoy such beverages at home.

Last month, SodaStream teamed up with a renowned lifestyle magazine brand, Cooking Light, to launch healthy fruit-flavored syrups. These beverages will be offered in Passion fruit-Mango and Kiwi-Pear flavors and will be available from the first quarter of 2014.

These partnerships will not only enhance the visibility of SodaStream’s brand, but will also ensure consumer acceptance in the U.S., where the demand for carbonated drink is very strong.

SodaStream carries a Zacks Rank #3 (Hold). Some other players in the consumer product industry which look attractive at present include Jarden Corp. (JAH) and Prestige Brands Holdings, Inc. (PBH). All the companies hold a Zacks Rank #2 (Buy).

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