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Strategies & Market Trends : Roger's 1998 Short Picks -- Ignore unavailable to you. Want to Upgrade?

To: BelowTheCrowd who wrote (18256)	6/18/1999 3:06:00 PM
From: Kip518	Read Replies (1) \| Respond to of 18691

Made zero sense from start to finish. Revealed how insulated Quaker Oats was from the natural market for the product they were trying to sell. There is an important part missing from your scenario. Prior to buying Snapple, the great success of Gatorade has (and still does) bolster the profit picture of the company tremendously. (Remember Quaker had to buy the whole company of Campbell VanCamp just to get Gatorade). With successful marketing (and some good luck) Quaker went, almost overnight, from being a sleepy little oat cereal company to a money machine with piles of cash in the bank. Hostile takeover rumors were flying...Coke, Pepsi, or Philip Morris were going to snap in a bite. The financial presses saw no way was Quaker going to remain independent. The apparently foolish and outrageously priced purchase of Snapple put a stop to that talk and those ideas in a minute. Coke and Pepsi just had to resort to coming out with their own piddly sport drinks. PM wanted none of it. So while Snapple may have been an expensive "mistake" and certainly cost the CEO his job, it also saved the company from being absorbed by a monster. For Quaker employees and currently stockholders it was the best outcome.