PepsiCo Will Acquire SodaStream for $3.2 Billion

The big headline in Monday trading was that drink and snack giant PepsiCo will be buying Israel-based SodaStream for a whopping $3.2 billion.

PepsiCo announced its plans to acquire the carbonated drink maker and said it would be paying $144 a share in cash for the company’s outstanding stock. This represents a 32% premium to the stock’s 30-day volume weighted average price.

“We get to play in a business — home beverages — where we don’t play,” said PepsiCo’s CFO Hugh Johnston to CNBC.

“SodaStream is highly complementary and incremental to our business, adding to our growing water portfolio, while catalyzing our ability to offer personalized in-home beverage solutions around the world. From breakthrough innovations like Drinkfinity to beverage dispensing technologies like Spire for foodservice and Aquafina water stations for workplaces and colleges, PepsiCo is finding new ways to reach consumers beyond the bottle, and today’s announcement is fully in line with that strategy,” said PepsiCo President Ramon Laguarta. Laguarta will be succeeding current CEO Indra Nooyi on October 3rd.

With twelve years as CEO of PepsiCo, buying SodaStream is one of the biggest moves Nooyi has made.

“PepsiCo and SodaStream are an inspired match,” said Nooyi. “Daniel and his leadership team have built an extraordinary company that is offering consumers the ability to make great-tasting beverages while reducing the amount of waste generated. That focus is well-aligned with Performance with Purpose, our philosophy of making more nutritious products while limiting our environmental footprint. Together, we can advance our shared vision of a healthier, more-sustainable planet.”

Daniel Birnbaum, SodaStream CEO and Director said, “Today marks an important milestone in the SodaStream journey. It is validation of our mission to bring healthy, convenient and environmentally friendly beverage solutions to consumers around the world. We are honored to be chosen as PepsiCo’s beachhead for at home preparation to empower consumers around the world with additional choices. I am excited our team will have access to PepsiCo’s vast capabilities and resources to take us to the next level. This is great news for our consumers, employees and retail partners worldwide.”

According to the press release on PepsiCo’s website, the acquisition has been unanimously approved by the Boards of Directors of both companies and the transaction is subject to a SodaStream shareholder vote, certain regulatory approvals and other customary conditions. It is expected to close by January 2019.

SodaStream shares are up over 80% this year so far.

Disclaimer: We have no position in PepsiCo, Inc. (NASDAQ: PEP) nor Sodastream International Ltd/ (NASDAQ: SODA) and have not been compensated for this article.