Dr Pepper makes a $1B addition to its flavor profile as Big Soda pours into energy drinks
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A burst of energy… Beverage behemoth Keurig Dr Pepper is bouncing off the walls and into the energy-drink aisle. The company said yesterday that it’s buying Ghost, a fast-growing energy and sports-bev brand, for $1B+. That’d make it its biggest acquisition since it took over the parent co of Dr Pepper and Snapple six years ago in a $19B deal. The plan: KDP will first invest $990M into Ghost for a 60% stake, and then buy the remaining 40% in four years. It hopes its latest highly caffeinated play (Ghost drinks have about 5x the caffeine of a Dr Pepper) can help it capture some of the $23B US energy-drink market.
Off the shelf: Ghost is sold in lots of flavors, including cobranded candy varieties evoking Sour Patch Kids and Swedish Fish. The energy bevvie’s sales have quadrupled in three years.
Can collection: In 2022, KDP bought a 30% stake in C4 Energy maker Nutrabolt and invested in the sugar-free A Shoc brand. And last month it teamed up with Black Rifle Coffee to sell its expanded energy-bev line.
More energy, more passion… Big Soda’s been guzzling energy drinks. Coca-Cola is the largest shareholder of Monster Beverage, which acquired Bang Energy out of bankruptcy last year. PepsiCo nabbed Rockstar Energy for $3.9B in 2020. Two years later Coke poured $550M into Celsius, which has been winning with women who work out. And as the pick-me-up market grows (thanks largely to teens) restaurants are also taking a sip. Starbucks and Dunkin’ each introduced higher-caff energy-drink options this year, and Sonic sells a Red Bull Slush.
Don’t judge a drink by its can… Energy drinks have evolved beyond aggressive aesthetics (picture Monster’s claw-mark can) made for dirt bikers and skydivers. Now some brands position themselves as healthy-ish caffeine-packed liquids that pair perfectly with a squat sesh. With cleaner can designs and an emphasis on vitamins, some bevs have been criticized over using a “halo of health” to pump sales as health professionals question their safety.