PepsiCo (NASDAQ:PEP) struck a deal to increase its ownership stake in Celsius Holdings through a $585 million deal, according to Bloomberg. Sources indicate that the move will see PepsiCo’s (NASDAQ:PEP) stake grow to 11% after the purchase of convertible preferred stock and the food and beverage giant will have the right to nominate another director to the Celsius Holdings (CELH) board of directors.
As part of the transaction, Celsius (CELH) is expected to acquire PepsiCo’s (PEP) Rockstar Energy brand in the U.S. and Canada. Rockstar Energy is an American energy drink brand founded in 2001 by Russ Weiner that was purchased by PepsiCo (PEP) in 2020 for $3.85 billion.
Crucially, the deal will also see Celsius’ recently acquired Alani Nu energy drink brand move to the PepsiCo (PEP) distribution (PEP) network in the U.S. and Canada. Alani Nu has been tracking extremely strong in recent Nielsen data reports.
Shares of Celsius Holdings (CELH) jumped 5.8% in premarket trading. PepsiCo (PEP) moved 0.3% higher. Energy drink juggernaut Monster Beverage (MNST) slipped 0.4%.