**History and Acquisition by Coca-Cola:**
– Founded in May 1996 by J. Darius Bikoff
– Introduced Smartwater, Fruitwater, and Vitaminwater in 1996, 1998, and 2000 respectively
– Expanded to nationwide distribution in the early 2000s
– Top-selling enhanced water brand in the US by 2002
– Revenue of $350 million in 2006
– Acquired by The Coca-Cola Company for $4.1 billion in cash in 2007
– Tata Group received $1.2 billion for its 30% minority ownership
– Global expansion to the UK, Australia, France, and Argentina
– Plans for further expansion to Canada and Mexico
– Energy Brands operates nearly autonomously under Coca-Cola
**Legal Disputes:**
– Lawsuit against PepsiCo in 2006 over trade dress infringement
– Settlement with PepsiCo resulting in packaging changes
– Class-action lawsuit in 2009 alleging deceptive marketing
– Allegations of misleading the public about Vitaminwater’s benefits
– Coordination of lawsuits against Coca-Cola in 2011
**Business Model and Financials:**
– Annual sales revenue of $350 million in 2006
– 70% shares held by employees and smaller investors before Coca-Cola acquisition
– 30% shares held by Tata Group
– Involvement of 50 Cent as a minority shareholder in 2004
– Forbes reported Bikoff owning 25% but denied it
**Product Line:**
– Vitaminwater: Introduced in 2000, targeted at adults as a healthier alternative to soft drinks, with six different flavors available
– Smartwater: Vapor-distilled water with added electrolytes for taste, marketed as a premium hydration option
– Vitaminenergy: Energy drink with ingredients similar to vitaminwater, containing natural caffeine, vitamins, electrolytes, and crystalline fructose
– Fruitwater: Sparkling version of Vitaminwater discontinued by Coca-Cola in 2015 due to poor sales, with flavors like Black Raspberry, Strawberry Kiwi, Lemon-Lime, Orange Mango, Watermelon Punch
**Misleading Advertising and Controversies:**
– Criticism for high sugar content by Australian consumer organization Choice
– Lawsuits by the Center for Science in the Public Interest against Coca-Cola
– Federal judge allowing class-action lawsuit against Coca-Cola to proceed
– UK’s Advertising Standards Authority ruling vitaminwater advertisement as misleading due to sugar content
– Coca-Cola defending vitaminwater’s health claims against the lawsuits
Energy Brands, also doing business as Glacéau, is a privately owned subsidiary of The Coca-Cola Company based in Whitestone, Queens, New York, that manufactures and distributes various lines of drinks marketed as enhanced water. Founded in May 1996 by J. Darius Bikoff with an electrolyte enhanced line of water called Smartwater, Energy Brands initially distributed its products to health food stores and independent retailers in the New York area. Adding Fruitwater and Vitaminwater to its line in 1998 and 2000, respectively, the company expanded to nationwide distribution in the early 2000s.
| Company type | Subsidiary |
|---|---|
| Industry | Beverage manufacturing and bottling |
| Founded | May 1996 |
| Founders | J. Darius Bikoff Mike Repole |
| Fate | Acquired |
| Successor | The Coca-Cola Company |
| Headquarters | , |
Number of locations | 37 |
Key people | Mike Repole, President Mike Venuti, CFO Carol Dollard, COO Rohan Oza, CMO |
| Products | VitaminWater SmartWater VitaminWater10 VitaminWaterZero |
| Revenue | US$350 million (2006) |
Number of employees | 750 |
| Parent | The Coca-Cola Company |
| Website | drinksmartwater |
By 2002, the Glacéau line of waters was the top-selling enhanced water brand in the United States, with the company's Vitaminwater being its best-selling product. In 2006, the company earned US$350 million in revenue. The company then began its global expansion, launching its products in the United Kingdom and Australia in 2008, France in 2009 and Argentina in 2011.
Energy Brands is owned primarily by Bikoff, employees, and small investors. Rapper 50 Cent obtained a minority share of the company as part of an endorsement deal in the company. Thirty percent of the equity was sold to LVMH sometime in the 2000s, which in turn sold those shares. The shares eventually were sold to India-based Tata Group in August 2006, which held the shares until May 2007 when The Coca-Cola Company purchased the company as an independent subsidiary, leaving its actual operations with its existing management including Bikoff.