2 weeks Ago
Most people choose coffee as their daily morning pick-me-up, but sometimes, a single cup isn't enough to make up for the minimum seven hours of sleep some didn't manage to get the night before. If you need an extra dose of caffeine to stay awake throughout the day or simply want to change things up, energy drinks are the next best option, with some containing more caffeine than the standard cup of Joe. 💰💸 Don’t miss the move: SIGN UP for TheStreet’s FREE Daily newsletter 💰💸 Energy drinks are the second-most popular dietary supplement consumed by teenagers and young adults in the U.
S., behind multivitamins. This industry is growing rapidly in the U.
S., reaching $19.2 billion in 2023, yet it's still projected to grow at a yearly rate of around 8% and be worth approximately $33 billion by 2030.
Bloomberg/Getty Images Energy drink companies battle for the top spot in a growing market With such a profitable product, many companies have invested in creating their own energy drink imprint or acquiring pre-existing energy drink brands to hopefully profit from their popularity. Red Bull has been leading the energy drink industry for decades, with Monster Beverage Corporation ( MNST ) coming in second and PepsiCo ( PEP ) in third. Keurig Dr Pepper ( KDP ) is one of the top beverage companies in the U.
S. It has an extensive portfolio of 25 brands spanning multiple beverage categories, including soft drinks, coffee, water, tea, and more. The company has also tried to dabble in the energy drink industry with its brands Venom Energy and Xyience Energy, but the company has yet to land itself among the top ten in the U.
S. However, Keurig Dr Pepper looking to take the crown from its more popular energy drink rivals, as it has agreed to an acquisition that might soon land it among the top. Keurig Dr Pepper agrees to acquire Ghost Lifestyle and Ghost Beverages On Thursday, Keurig Dr Pepper announced it has agreed to acquire the sports nutrition business Ghost Lifestyle and its ready-to-drink energy drink brand Ghost Beverages.
Founded in 2016, Ghost's sales have quadrupled over the past three years, reaching $500 million in annual sales. Its energy drink brand has become one of the fastest-growing brands in its category. Related: Owner of formerly bankrupt retail store chain delivers harsh news to workers According to the agreement, Keurig Dr Pepper will initially purchase a 60% stake in Ghost for approximately $990 million.
The transaction is expected to be finalized in late 2024 or early 2025. The company will then acquire the remaining 40% for around $140 million in the next four years to obtain full ownership in 2028. Additionally, Keurig Dr Pepper will invest $250 million to transition Ghost's existing distribution agreements to its own direct store delivery network.
More Retail: As part of the agreement, Ghost's co-founders, Dan Lourenco and Ryan Hughes, will continue to lead the brand and operate as part of the Keurig Dr Pepper U.S. Refreshment Beverages segment.
This latest acquisition expands Keurig Dr Pepper's portfolio of brands and reaches a new consumer, further enhancing the already established brand. "The energy category is poised for continued long-term growth, which KDP expects to increasingly capture through our platform-based approach. KDP's portfolio of complementary energy brands is aligned against distinctive consumer need states, and, together, these offerings will unlock significant growth and scale benefits across our entire DSD portfolio," said Tim Cofer, Keurig Dr Pepper's Chief Executive Officer.
Keurig Dr. Pepper closed Friday at $34.58.
They're up 4.1% in 2024 but down 6.4% on the week.
The deal surprised Wall Street, according to the Motley Fool , and third-quarter revenue was lower than analyst estimates. Related: Veteran fund manager sees world of pain coming for stocks.
