By Calli Gregg F or as long as I can remember beverage giants Coca-Cola Company and PepsiCo have been at war over capture product market share. Recently PepsiCo announced that it has a new ally as it reportedly acquired the carbonated fizzy drink maker SodaStream for $3.2 billion USD. The deal is said to have the beverage giants acquiring all SodaStream’s outstanding shares a $144 USD per share, repre- senting a 32 per cent premium for the company that enjoyed a resurgence in the market after being targeted by anti-Israel boycotters. This acquisition comes after SodaStream reported its strongest results in company history, a 31 per cent year-over-year jump in revenues to $172 million USD, an 89 percent leap in operating profit to $32 million and an 82 percent climb by net profit to $26 million USD. PepsiCo Chairman and CEO, Indra Nooyi called the companies “an inspired match” since both companies aim to reduce waste and limit their environmental footprint. Nooyi goes on to say, “Together, we can advance our shared vision of a healthier, more-sustainable planet.” This is seen as a solid strategic move on the part of PepsiCo who has been battling soft carbonated drink sales for years now as customers move towards healthier alternatives. Given that SodaStream produces machines that allow people to make carbonated drinks in their own homes and has positioned itself as a provider of a healthy product in contrast to traditional sugary, carbonated drinks, this opens the door wide open for PepsiCo to capitalize on the opportunity to get into the homes of SodaStream users all over the world, which could be a game changer for the industry as this increases concerns regarding the use of plastic and them making their way into our oceans.
This acquisition will allow PepsiCo to build on SodaStream’s mission to bring healthy, convenient and environmentally friendly beverage solutions to consumers around the world.
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SPOTLIGHT ON BUSINESS MAGAZINE • AUGUST 2018
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