Mar 11, 2020
PepsiCo to buy Rockstar Energy Drinks for US$3.85 billion
Gordon Reid discusses PepsiCo
PepsiCo Inc. agreed to buy energy-drink maker Rockstar for US$3.85 billion to expand its beverage range as consumers shun traditional soft drinks.
The deal is one of the first strategic moves by PepsiCo Chief Executive Officer Ramon Laguarta since he took over from Indra Nooyi in 2018.
PepsiCo and rival Coca-Cola Co. have been racing to expand their lineups of faster-growing drinks. Coca-Cola acquired U.K. chain Costa Coffee in 2018 and has debuted a line of spirit mixers.
Energy drinks, known for their high sugar and caffeine content, have been a relative weak spot for both companies. Austria’s Red Bull GmbH dominates the category, selling about 7.5 billion cans annually.
Rockstar, which PepsiCo already distributes, was founded by the entrepreneur Russell Weiner in 2001 and is sold in 16-ounce cans.
PepsiCo doesn’t foresee the deal affecting revenue or earnings per share this year, the company said in a statement. It’s expected to close in the first half of 2020.