Published: Tue, August 21, 2018
Markets | By Otis Pena

PepsiCo buys fizzy drink maker SodaStream for $3.2bn

PepsiCo buys fizzy drink maker SodaStream for $3.2bn

SodaStream produces machines that allow people to make fizzy drinks in their own homes and has positioned itself as a provider of a healthy product in contrast to traditional sugary, carbonated drinks.

"Together, we can advance our shared vision of a healthier, more sustainable planet", she added. The deal will give the brand access to PepsiCo's distribution capabilities, global reach, R&D, design and marketing expertise with the aim of fuelling expansion and innovation.

"PepsiCo and SodaStream are an inspired match", Nooyi said in a statement Monday.

The purchase will probably be the last big move by PepsiCo chief executive Indra Nooyi, who said this month she's stepping down as head of the beverage company after 12 years in the job.

"Nobody has come here to obtain, to take, to close down and build a copy anywhere else", Birnbaum said at a news conference in Tel Aviv that was attended by incoming PepsiCo Chief Executive Ramon Laguarta. That's 11 per cent higher than Friday's closing price and would be the Purchase, New York-based company's largest acquisition in eight years. Over the years, many users have used SodaStream only for making fizzy water, without the flavoured syrups it sells.

He adds: "SodaStream is highly complementary and incremental to our business, adding to our growing water portfolio, while catalysing our ability to offer personalised in-home beverage solutions around the world".

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SodaStream shares jumped 9.4 per cent to close at US$142.11 in NY, while PepsiCo slipped 0.1 per cent to US$114.94.

PepsiCo said it is acquiring all SodaStream's outstanding shares at $144 per share, a 32pc premium to the 30-day volume weighted average price.

PepsiCo is in the process of expanding its water offerings.

In 2015, SodaStream shut down a plant in the West Bank following a boycott campaign that included targeting Hollywood actress Scarlett Johansson after she advertised its product. Consumers buy flavored pods to inject a choice of tastes into a reusable bottle, such as acai berry, coconut-watermelon and elderflower.

After Coca-Cola bought the stake in Green Mountain in 2014, Nooyi said in an interview PepsiCo would avoid committing to a single technology in at-home soda makers. Sugar taxes also represent a prominent threat.

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