Coca-Cola has filed a pre-merger Hart-Scott-Rodino Act (HSR) notification with the Federal Trade Commission, trade publication the Beverage Digest reported. The filing is necessary for deals of significant size under anti-trust regulatory framework, which seeks to prevent merger and acquisitions that could reduce competition, lead to higher prices, lower quality of goods or services, or decreases innovation.

Shares of Tata Tea surged 4.4 per cent to Rs 877.55 on the Indian bourses following reports about the pre-merger filing. Although it was not clear whether Coca-Cola was looking to acquire the Tatas’ stake or not, brokers said the sharp rally in Tata Tea’s shares on Tuesday was triggered by expectations that the company could reap huge premium on its stake in Glaceau if the US giant decides to acquire 100 per cent of the North American energy drink maker.

Citing unnamed sources in its special edition published on Monday, the magazine said that the HSR filing triggers a review of any possible antitrust implications of the proposed deal. It could mean several things ranging from Coke having an agreement to acquire Glaceau to Coke having a non-binding letter of intent for such a deal, the report said.

The report quoted sources as saying that the FTC only begins its review process when the major deal points are agreed upon, at least in principle, but a deal could be and was likely, still subject to Coca-Cola Co board approval.

While it was not known when Coke filed the HSR notification with the FTC, a review process normally takes 30 days. However, it could be shorter or longer in certain cases. Glaceau, in which Tata Tea had acquired a 30 per cent stake for $677 million in August last year, was reported to be on Coke’s takeover radar earlier last month.

When contacted, a Tata Tea spokesperson in India said: “We do not wish to comment on speculations.”

Based on the price of Tatas’ acquisition, New York-based Glaceau could be valued at close to $2.25 billion. However, the market speculations have put the value of the deal anywhere between $3-4 billion.

Eyeing the energy drink maker

• Coca-Cola has filed a pre-merger notification for Glaceau, reported Beverage Digest

• Tata Tea owns 30 per cent stake in the energy drink maker

• Tata Tea shares soared 4 per cent on the back of the news report

• Market speculations value the deal between $3-4 billion

• Shares of Coca-Cola dropped 1.4 per cent at the NYSE