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Cott Closes USD 775m Acquisition of Primo Water
Thursday 05 March 2020

5 March 2020 - Canada-based water, coffee, tea, extracts and filtration service company Cott Corp. (NYSE: COT) (TSX: BCB) has closed the acquisition of US-based Primo Water Corp. (NASDAQ: PRMW), a provider of water dispensers and purified bottled water, for USD 14 per share payable in cash and stock, the company said.

The cash/stock consideration values Primo at approximately USD 775m.

Under the terms of the merger agreement, a wholly-owned subsidiary of Cott will promptly commence an exchange offer to acquire all of the outstanding shares of Primo's common stock, and each share of Primo common stock will be exchanged for USD 5.04 in cash and 0.6549 common shares of Cott, or, at the election of Primo's stockholders, for USD 14.00 in cash or 1.0229 common shares of Cott, subject to the proration procedures set forth in the merger agreement.

The combination of Cott and Primo, along with the recent announcement of Cott's evaluation of certain strategic alternatives for its S and D Coffee and Tea business, including a sale of S and D, will transition Cott into a pure-play water company.

The acquisition of Primo and planned sale of S and D will result in a pure-play water company that increases top-line growth and margins and drives long-term value creation for our shareholders.

The consummation of the exchange offer is subject to various conditions, including a minimum tender of a majority of outstanding shares of Primo common stock and other customary conditions.
Following consummation of the exchange offer, that subsidiary will merge with and into Primo and Primo will become a wholly-owned subsidiary of Cott.

Any eligible shares not validly tendered will be cancelled and converted into the right to receive the same price per share offered in the exchange offer. Upon completion of the acquisition, Primo shares will cease to be traded on NASDAQ.

Cott will pay a total of approximately USD 216m in cash to Primo stockholders, funded with the proceeds of a new term debt issuance or proceeds from the sale of S and D Coffee and Tea, and issue approximately 26.8 m new shares to Primo stockholders.

Cott has obtained financing commitments of up to USD 400m from an affiliate of Deutsche Bank Securities Inc. to support the payment of the acquisition price and the refinancing of Primo's debt.

Cott reaches over 2.5m customers or delivery points across North America and Europe and is supported by strategically located sales and distribution facilities and fleets, as well as wholesalers and distributors.

Primo Water Corp. (NASDAQ: PRMW) is a provider of water dispensers, multi-gallon purified bottled water, and self-service refill drinking water.

Deutsche Bank Securities Inc. acted as financial advisor to Cott and Drinker Biddle and Reath LLP and Goodmans LLP provided legal counsel to Cott. Goldman Sachs acted as financial advisor to Primo and K and L Gates LLP provided legal counsel to Primo.
Date Published: 05/03/2020
Target: Primo Water Corp
Country: USA
Deal Size: 775m (USD)
Sector: Food/Beverages/Tobacco
Type: Corporate acquisition
Financing: Cash and Stock
Status: Closed
Buyer: Cott Corp
Buyer Advisor: Deutsche Bank Securities , Drinker Biddle and Reath , Goodmans LLP