Coca-Cola Co said on Monday it would buy the remaining stake in BodyArmor it did not already own for $5.6 billion (€4.8 billion), as the soda maker amps up its sports drink portfolio to take on market leader, PepsiCo Inc's Gatorade.
The deal, which values BodyArmor at about $6.59 billion, marks a shift in strategy for Coca-Cola that spent the last year offloading or discontinuing brands, including its own energy-drink brand, to focus on its sodas.
BodyArmor currently makes about $1.4 billion in annual retail sales and has a 50% growth rate, Coca-Cola said.
The sports drink maker gained much of its popularity due to the backing from basketball great Kobe Bryant, who took a stake in the company in 2013, two years after it was launched.
The world's largest beverage maker, which had first acquired a 15% stake in BodyArmor in 2018, said BodyArmor will be managed as a separate business within its North America operating unit.
At the time Coca-Cola took its initial stake, BodyArmor was valued at $2 billion, according to a Sunday Wall Street Journal report.
On Friday, Bloomberg News reported citing people with knowledge of the matter that Coca-Cola is nearing a deal to buy a controlling stake in the sports drink company, valuing it at about $8 billion (€6.86 billion).
'A Great Addition'
Commenting on the deal, Alfredo Rivera, president of the North America operating unit of The Coca-Cola Company, said, “BodyArmor has been a great addition to the system lineup over the last three years, and the company has driven continuous innovation in hydration and health-and-wellness products.”
“We’re excited to bring BodyArmor into The Coca-Cola Company and work with Mike Repole and his leadership team on the next stage of growth.”