Threaded Mode | Linear Mode

03-19-2004 11:30 PM

<a href='http://news.ft.com/servlet/ContentServer?pagename=FT.com/StoryFT/FullStory&c=StoryFT&cid=1079419787047&p=1012571727088' target='_blank'>http://news.ft.com/servlet/ContentServer?p...p=1012571727088</a>

Coca-Cola, which was damaged by a contamination scare five years ago, was forced to withdraw its Dasani bottled water brand from the UK on Friday after discovering it contained illegal levels of a chemical that could increase the risk of cancer.

The embarrassing voluntary recall brought back painful memories of 1999, when several Belgian children fell ill after drinking contaminated Coke, prompting a widespread recall of the soft drink across Europe and a public relations nightmare for the company.

The slow and impersonal response to the crisis by Douglas Ivester, Coca-Cola's chief executive, was one reason for his departure from the company later that year.

Dasani's UK debut at the end of January had already been turbulent. Coca-Cola was pilloried for using tap water instead of a natural spring as the source, even though Dasani did not claim to be a mineral water.

Dasani, which has been sold in the US for the past five years, is essentially tap water that has been treated and bottled.

Coca-Cola had claimed it was able to improve the purity of tap water through a process perfected by Nasa, the US space agency, before adding "a perfect balance of minerals".

But on Friday the drinks company admitted the much-vaunted manufacturing process had accidentally introduced illegal levels of bromate, a chemical that could cause an increased risk of cancer after long-term exposure.

The Food Standards Agency, which regulates food safety in the UK, said there was no immediate risk to public health.

Thames Water, the UK utility that supplied the tap water to the Dasani plant near London, was on Friday put in the bizarre position of having to reassure its domestic customers that their mains water was safe to drink.

Thames tap water sells for 0.03p for a half-litre. It cost up to 95p ($1.74) for the same amount of Dasani.

Analysts at JP Morgan and Morgan Stanley both questioned the viability of the company's plan to launch Dasani in other European countries. But Coca-Cola still plans to launch Dasani on April 19 in France, the most sophisticated bottled water market in the world. The Dasani to be sold in France is a genuine mineral water.

Paul Gordon, president of Coca-Cola France, said: "The arrival of Coca-Cola in the bottled water market in France is as important to the company as the launch of Coca-Cola light [as Diet Coke is known] in 1988."