Groupe Danone of France acquired its Canadian rival, Sparkling Spring Water Holdings, Ltd., in a plan to move deeper into office-delivery and home-delivery water markets.
Terms of the acquisition were not disclosed. However, The Wall Street Journal reported that when the agreement was announced in November, Sparkling Spring was likely to fetch $300 million to $400 million, based on deals for similar companies.
Sparkling Spring, based in Dartmouth, Nova Scotia, is a producer and distributor of bottled water for home and office delivery. The business has annual revenue of more than $100 million, employs about 1,100 and owns 210,000 water coolers for rent.
The acquisition is part of Danone's drive to strengthen its position in a profitable segment of the U.S. water business and overseas. The deal also adds to Danone's global reach.
While lower-profile than the retail business, which features such brands as Evian and Dannon, home and office delivery has become a highly lucrative segment of the beverage industry and is poised for consolidation.