PepsiCo will acquire Rockstar Energy in a $3.85 billion deal, doubling down on energy drinks and with an eye toward turning around its struggling Mountain Dew brand.
“As we work to be more consumer-centric and capitalize on rising demand in the functional beverage space, this highly strategic acquisition will enable us to leverage PepsiCo’s capabilities to both accelerate Rockstar’s performance and unlock our ability to expand in the category with existing brands such as Mountain Dew,” said PepsiCo Chairman and CEO Ramon Laguarta.
Pepsi has had a distribution agreement with privately held Rockstar in North America since 2009. In addition to Rockstar, PepsiCo’s energy portfolio includes Mountain Dew’s Kickstart, GameFuel, and AMP.
The food and beverage giant said that it does not expect the acquisition to have a material impact on its revenue or earnings per share in 2020. If regulators approve the deal, it is expected to close in the first half of 2020.
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