The End of the Age of Innocence?

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Ethical drinks company sells minority stake to Coca-Cola.

The three founders of the ethical soft drinks company innocent, have defended their decision to sell a minority stake in their business to Coca-Cola.

Under the deal, Coca-Cola are investing £30m for a 10-20% stake in the Hammersmith-based company. Innocent say they intend to use the money to take the business "to the next level of success in innovation and expansion across Europe”.

Richard Reed, co-founder of innocent said: "We’re excited by this minority investment as it enables us to do more of what we are here to do – get natural, healthy products to as many people as possible. All the money is coming into the business to fund our European expansion.” The company says none of the money raised will go to innocent's shareholders.

Innocent founders Richard Reed, Adam Balon and Jon Wright say they spoke to several potential investors before choosing Coca-Cola but say many of the other potential deals came with too many strings attached.

“That's why we chose Coke – because of all the people we spoke to, they were the ones who guaranteed a hands-off approach; an approach that means that we continue to run innocent our way. We will continue to make the decisions, just as we always have done. Adam, Jon and Richard, the three founders, will continue to lead the business. Coke have placed no restrictions on what we can and cannot do. But we can ask for their advice and help from time to time, which we think will be useful. They may even at some point be able to help distribute our products,” the founders say.

They say the new investment will help them take their business forwards: “The background to this deal is that we’re ten years into a thirty year journey towards what we want innocent to become. Our vision is for innocent to grow into a global, natural, healthy food and drinks company – one that makes stuff which is good for people, uses ‘lighter footprint’ ingredients, packaging and production techniques, and which supports charities in the countries where our fruit comes from. In terms of our international expansion, it’s a big goal, and to get there we're going to need a bit of help,” they say.

James Quincey, Group Business Unit President for Coca-Cola Europe said of the investment: :
“We are delighted to have the opportunity to invest in innocent’s future. We have long admired their brand, their products and their unique approach to business. Our investment will support innocent in helping more consumers enjoy their products and for the business to expand across Europe.”

Innocent is a company with an ethical ethos, and produces smoothies using fruit from farms with high social and environmental standards, uses 100% recycled plastic bottles and donates 10% of its profits every year to charity.

The business is based in the Goldhawk Industrial Estate where plans to build a controversial new development have sparked fears that innocent may have to leave the area.

April 8, 2009