American beverage and soft drink giant PepsiCo declared the plan to buy carbonated drink maker SodaStream for gaining at-home soft-drink-making technology. The deal is said to be valued at $3 billion, Pepsico would pay $144 per share in cash for SodaStream’s, DIY seltzer maker, outstanding stock. This is a 32 percent premium of SodaStream’s 30-day volume weighted average price.
The substantial deal will enable PepsiCo to channelize its customers by reaching them in their homes instead of stores. The leading beverage company would make double benefits on its drinks business that was previously struggling in North America. The consumers, there, have parted ways with sugary and carbonated beverages. However, it is also a challenge for the company to simultaneously maintain its legacy beverages, as the acquisition may lead to a reduction in sales volume and revenue for the same.
This deal would be, probably, the last biggest move by Indra Nooyi, PepsiCo’s CEO soon to step down from her position. Nooyi’s contributions such as pulling off from sugary products along with giving healthier alternatives have enabled PepsiCo to reach newer heights.
Products from SodaStream fits best in PepsiCo’s aim of “making more nutritious products while limiting our environmental footprint” stated Nooyi. She, in a statement, said, “Together, we can advance our shared vision of a healthier, more sustainable planet.” Ramon Laguarta, soon to be the new CEO, said, “PepsiCo is finding new ways to reach consumers beyond the bottle.”
After this deal, PepsiCo will be able to capture markets where it had less hold on. As SodaStream, currently, is distributing in about 80,000 individual retail stores across 45 countries, it has largely occupied markets of Germany, France, Canada, and the U.S.
PepsiCo’s share prices after plan announced to buy SodaStream