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Dr Pepper to expand in North Texas after becoming separate company
12:00 AM CDT on Friday, May 2, 2008
North Texas could benefit as the Plano-based maker of Dr Pepper parts ways from its British parent, with the soft drink company saying it plans to expand operations here.
Next Wednesday, the beverage arm of London-based Cadbury Schweppes PLC will become a separate publicly traded company called Dr Pepper Snapple Group Inc.
The new entity, which will trade on the New York Stock Exchange under the ticker DPS, plans to move its research and development team from Trumbull, Conn., to its Plano headquarters, Larry Young, president and chief executive, told analysts Thursday.
"By having the core research and development capability at our headquarters, we expect to be able to move more rapidly and reliably from prototype to full commercialization," the company said in a filing with the Securities and Exchange Commission on Monday.
A research facility is under construction at the Plano headquarters and is set to open this summer, said company spokesman Greg Artkop. He declined to say how many nutritionists, flavor scientists and other staffers will work there.
The new company also plans to expand operations in Irving, already home to a multi-product manufacturing plant that is one of the largest in the system. It will become a "pilot plant" to test concepts before deciding on a full rollout, Mr. Artkop said.
Dr Pepper Snapple has been planning for life away from the mother ship since March 2007. That's when Cadbury Schweppes bowed to pressure from shareholders, led by activist investor Nelson Peltz, who felt the candy and gum business had more growth potential than soft drinks.
Once the two companies are separate, Dr Pepper Snapple will take over the beverage business in the United States, Canada, Mexico and the Caribbean, selling such well-known soft drinks as 7UP, Sunkist orange and Motts juices, as well as Snapple and Dr Pepper, the oldest major soft drink sold in the United States.
The new company will have about 20,000 employees – including 15,000 added within the past two years from acquisitions. Nearly 2,300 of the workers are in North Texas.
As of Dec. 31, the company had 21 manufacturing plants and about 200 distribution centers in the United States.
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