TORONTO — Beverage giant Cott Corp. of Toronto plans to invest as much as US$55 million to make its own PET bottles for soft drinks and bottled water in North America and elsewhere.
Cott first broke with its tradition of buying PET bottles last year when its Pontefract, England, facility began making the containers. Company officials declined to elaborate on when and where the firm will enter PET bottle production in the United States and Canada.
``Strategically it's the right thing to do,'' said Perry Caicco, an analyst with securities firm First Marathon Inc. of Toronto.
Cott, which has global sales of about C$1.4 billion (US$1.02 billion), first revealed its PET ambitions in its 1997 annual report. It noted that it became self-sufficient in PET bottles in the United Kingdom and will expand the program into North America to lower freight costs of shipping empty containers to its bottling plants.
Cott recently issued US$125 million in new debt and told analysts in June that it will set aside US$55 million of the proceeds for its PET bottle program. He said that whether Cott invests that full amount will depend on how successful the firm is with its first few blow molding plants.
``I hear the [Pontefract blow molding operation] is going well and they are pleased with it,'' Caicco said. ``But they probably don't know yet if they are getting the targeted savings.''
Cott spokeswoman Monica Ruthig said company officials might have more to say about the PET program this fall.
Cott has bottling operations worldwide. Much of its U.S. bottling activity is supplied by third-party bottlers, but Cott plans to own most of its U.S. production within a few years.