Starting on 1 February, Molson Coors will assume exclusive commercialization rights to Fever-Tree’s US portfolio, encompassing a lineup of tonics, ginger beers, cocktail mixers, and other carbonated drinks. It will be responsible for co-manufactured production, marketing, sales, and distribution of the brand in the US.
The move is a step forward in Molson Coors’ ambition to build a total-beverage portfolio for a wide range of consumer preferences, across traditional alcohol occasions and non-alcohol occasions alike.
Underpinning the partnership is an equity investment, reflecting Molson Coors’ long-term focus on the opportunity. The company has agreed to acquire an 8.5% stake in Fevertree Drinks plc, resulting in Molson Coors becoming Fever-Tree’s second largest shareholder. The proceeds of the issue will be returned to shareholders via a share buyback programme of £71m, beginning in February 2025.
Established in the UK in 2004, Fever-Tree is a leading supplier in a high-growth, above premium space. In the US, Fever-Tree’s largest global market by revenue, the brand has built on its first-mover advantage and has become the #1 tonic and ginger beer brand nationwide since 2007, as per Nielsen.
Molson Coors plans to build on the position Fever-Tree has established by leveraging its core strengths, commercial scale and supply chain expertise to expand distribution, grow brand awareness, and create a runway for long-term growth in the US market.
Strategic benefits of the partnership include the ability for Fever-Tree to leverage Molson Coors’ national network of US distributors and customers, across the on- and off-trade. The supplier will also leverage the scale and strength of Molson Coors’ dedicated sales and commercial teams, to maximise Fever-Tree’s momentum, brand strength, and ability to grow its total addressable market.
Driving efficiencies
The partnership will further capitalise on Molson Coors’ broad supply chain network, procurement strength, and expertise to drive operational efficiencies, as well as managing the onshoring of US production.
A substantial incremental marketing fund will be deployed across the initial period of the partnership to drive further brand and category awareness.
In addition, the partnership also builds on Molson Coors’ recent momentum in advancing its Beyond Beer and premiumisation strategy. The company took a majority stake in energy drinks brand ZOA in November 2024 and has since expanded distribution into new accounts and channels.
Molson Coors is further preparing to bring Naked Life, Australia’s #1 non-alcoholic RTD cocktail, to the US this spring.
Fever-Tree further reported total group revenue of £367.9m in the year ended 31 December 2024, up 1% from the previous year.
The UK contributed £110.5m in FY24 revenue – a 4% dip from £114.8m in FY23. This reflected the subdued spirits backdrop, particularly in the on-trade, according to Fever-Tree.
The supplier highlighted an improved performance in the second half, performing well in the off-trade while growing share to extend its value share position.
Non-tonic products and new innovations had another year of strong growth, broadening appeal across more drinking occasions in the UK, according to the group.
Financial outlook
The drinks supplier further delivered an improved performance in the second half of the year, ending with global brand growth of 4% at constant currency.
It delivered strong growth in the US as well as market share growth across key markets despite a subdued trading environment. Revenue growth in the US stood at 12% in constant currency, with Fever-Tree finishing the year with 27% and 32% share of the Tonic and Ginger Beer categories respectively. Growth in the brand’s Club Soda products and can format also drove sales.
Fever-Tree CEO Tim Warrillow said: “Today’s announcement marks a transformational step for the Fever-Tree brand in the US and is not only a reflection of how far we have come since first entering the market in 2008 but also how the opportunity ahead for the brand continues to grow. With a national network providing scale and muscle, proven track record, supply chain expertise and clearly stated strategic desire to drive the future of their business beyond beer, Molson Coors are the ideal partner to take the Fever-Tree brand to the next level across the US.”
Molson Coors chief executive Gavin Hattersley said: “Our strategic partnership with Fever-Tree in the U.S. is a meaningful step in Molson Coors’ journey to becoming a total-beverage company with a winning portfolio of drinks for a wide variety of consumer occasions. We’ve made progress here, and today we are building on that progress in a significant way with Fever-Tree as the latest and largest non-alc brand to join our portfolio.
“U.S. is our biggest global market by revenue, and the same is true for Fever-Tree, so we believe this partnership provides ample opportunity for our teams to build on the strong success Fever-Tree has achieved to date. Our customers have been asking for a brand just like Fever-Tree from us, and by leveraging the scale, strong relationships and expertise of our team at Molson Coors, I’m confident in the road ahead for Fever-Tree as part of Molson Coors’ growing set of non-alc offerings in the U.S.”
Molson Coors chief commercial officer Michelle St. Jacques said: “Fever-Tree is the perfect fit for our growing portfolio of non-alc beverages. The quality is unmatched, the variety is fantastic, and the brand has achieved impressive scale in the U.S. and we believe there is more runway ahead.
“Fever-Tree sits at the intersection of beer and non-alc and is often available in stores where beer is sold, so it perfectly complements our Beyond Beer and premiumization strategies, playing in both alcohol occasions and non-alc occasions. We’re excited to welcome Fever-Tree into our portfolio as we work to reach more consumers and unlock growth in new channels and outlets across the U.S.”
