Procter & Gamble Co., seeking to find out how competitors of its Crush orange soda and Hires root beer bottle and market their products, plans to buy a Coca-Cola bottling company in Kentucky.
"It allows us to really get our feet wet as far as learning the bottling end of the business," said a spokesman for Procter & Gamble, the giant, Cincinnati-based consumer-products company that bought the Crush and Hires lines two years ago. "We really are pretty much in a learning mode as far as soft-drink bottling goes." Crush and Hires flavors are licensed by P&G to independent bottlers.
P&G expects to close the deal for privately held Coca-Cola Bottling Mideast Inc. of Lexington, Ky., in a few weeks. No price was disclosed.
Mideast, which has plants in Lexington and Louisville, bottles all of Coca-Cola's beverages, as well as Sunkist orange soda and A&W root beer, direct competitors of Crush and Hires. It does not bottle Crush or Hires.
"They do bottle products that compete with ours," the P&G spokesman said of Mideast, "but we don't see it as an issue, since it is an educational process for us."
A spokesman for the Coca-Cola Co. said the company had no comment on P&G's acquisition plans. P&G said Coca-Cola had not been informed in advance of the planned purchase, but has given P&G "positive feedback" about the acquisition.
P&G acquired Crush International, maker of Crush, Hires and a citrus drink called Sun-drop, in 1980.
In a statement released with the announcement of the planned purchase of Mideast last week, P&G President John G. Smale said "the purchase of a bottling operation is a logical step in the further development of our interest in the soft-drink business . . . . This acquisition will enable us to learn first hand about the bottling and distribution of soft drinks . . . "