Cott Corporation, a distributor of bottled and canned carbonated beverages, has signed a definitive purchase agreement to acquire S&D Coffee, a coffee roaster and provider of customised coffee, tea, and extract solutions to foodservice, hospitality and office segments in the US.

Cott will purchase S&D Coffee for approximately $355m, on a debt and cash free basis.

S&D chief executive officer Ron Hinson and its leadership team will join Cott and continue to lead the business.

"S&D is estimated to generate over $550m as annual revenues this fiscal year."

Cott chief executive officer Jerry Fowden said: “The S&D acquisition is another great step in our stated strategy to enhance our existing home and office water delivery, coffee, tea and filtration businesses where we believe our platform, operating strength and synergies can be leveraged.

“The addition of S&D brings our Better for You beverage platform to over 65% of our adjusted earnings before interest, taxes, depreciation and amortisation (EBITDA) on a pro forma basis, with carbonated soft drinks representing just 12% of adjusted EBITDA.

“After closing the S&D acquisition, we will have a leading position in the coffee and tea foodservice industry in North America, which is an excellent complement to our leading home / office delivery (HOD) water, office coffee and filtration business.”

S&D is estimated to generate over $550m as annual revenues this fiscal year.

The acquisition will broaden the distribution platform of Cott's existing DS Services coffee business in the US by adding in-house roasting, grinding and blending capabilities alongside a national distribution system.

S&D chief executive officer Ron Hinson said: “S&D was started in 1927 with a vision to produce quality coffee for the local area and has grown over the last 89 years to become a leading premier, national provider of quality coffee, tea and extracts for multiple channels.

 “In order to take the next step in our journey we wanted to find the right partner to support our future growth. In sharing our values and desire to further expand our category leadership in coffee, tea and liquid extracts, we found Cott to be the ideal partner for our business.”