Smoothie operators net £20m in Pepsi deal

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The Independent Online

Pete and Johnny: they are the Californian dudes who inspired Britain's £33m-a-year love affair with the smoothie, the fruit-flavoured drink that has provided breakfast balm to a detox generation.

Pete and Johnny: they are the Californian dudes who inspired Britain's £33m-a-year love affair with the smoothie, the fruit-flavoured drink that has provided breakfast balm to a detox generation.

For Harry Cragoe, the creator of PJ Smoothies, the eponymous Pete and Johnny embodied the health-giving, life-enhancing properties he wished to bring to a pasty-faced public when he returned to Britain from California in 1994 armed with his special recipe.

Yesterday, as the company was sold to the US multinational PepsiCo for a figure industry insiders estimated as close to £20m, one of the most closely guarded secrets in business emerged - the real identities of Pete and Johnny. According to the funky PJ website, the drinks offer "100 per cent fuss-free fruit, made by Pete and Johnny". But neither of them are the surf bums of the marketing blurb, The Independent can reveal. Pete is none other than Peter Dubens, the young telecoms entrepreneur behind Pipex Communications, while Johnny is Jonathan Sieff, the chief executive of the Global Brands consultancy and grandson of Lord Sieff, long-time chairman of Marks & Spencer.

Yesterday the businessmen expressed astonishment and amusement that their identities had been rumbled. They said they had made no money out of the brand, merely lending it their identity. "It was all a long time ago. We only gave our names," said Mr Sieff, 38. Mr Dubens, also 38, admitted he was not the greatest advert for a health drink, and said he and Mr Sieff had never come close to the ideal of the West Coast man - even during their younger days. "We were all friends and they were trying to think of a name and they asked for ours. We are very, very pleased for Harry," he said.

Mr Sieff can now boast Warner Bros and Planet Hollywood among his clients, along with Marco Pierre White and Arsenal's Patrick Vieira. Mr Dubens, who made his first million at 22 while in partnership with Mr Sieff selling T-shirts that changed colour in the heat, runs an online sports betting firm.

The men shared the enterprising spirit of the age with Mr Cragoe, 39, whose own story could come straight out of an entrepreneur's text book.

The former City broker was running an air filtration distribution company in Los Angeles in the early 1990s when he first tasted a smoothie. Returning to Britain he put everything he had into the product, selling his flat, car and investments, so convinced was he that UK consumers were ready to switch their loyalty from the squeezed fruit juices on offer. He began selling his drinks at 12 small convenience stores in London, but importing the frozen ingredients from the US proved impossible.

In 1998 be bought an old meat processing plant in Newark, Nottinghamshire, and within three years it was making 250,000 bottles a week, and PJ was selling in major supermarkets.

Mr Cragoe, who once fell off an 80ft cliff and survived, has overseen the expansion in the number of flavours he offers. But the new smoothie kid on the block, Innocent,last year overtook PJ as the market leader by month on month sales.

This week PepsiCo, the $27bn (£14bn) global food giant which already owns the Tropicana and Copella brands, signed the deal with PJ. Soft drink manufacturers have been keen to expand their "healthy" drink portfolios, as concerns mount over sugar and obesity.

This has not always met with success. Coca-Cola had to withdraw its Dasani mineral water after it emerged that not only was it bottled from a tap in Sidcup, but some bottles had been contaminated with a carcinogen.