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Keurig Dr Pepper Grows Energy Portfolio With Ghost Acquisition

Liz Dominguez
Ghost

Keurig Dr Pepper is expanding its beverage portfolio by acquiring Ghost, a sports nutrition business that offers liquid refreshments and supplements but is most known for its ready-to-drink energy brand.

CEO Tim Cofer said the acquisition would allow KDP to tap into a differentiated brand with significant growth potential to expand the energy category, which the company looks to capture through its platform-based approach. 

“KDP’s portfolio of complementary energy brands is aligned against distinctive consumer need states, and, together, these offerings will unlock significant growth and scale benefits across our entire DSD portfolio," he said. 

Energizing KDP’s Portfolio

The ready-to-drink (RTD) energy market is currently $23 billion in size, according to Cofer, and appeals to a wide range of consumers across all ages and demographics, including Gen Z. Additionally, there are significant opportunities for growth in household penetration compared to other leading beverage categories, he said during a call with investors.

He considers energy still in the development stage of price pack architecture and channel diversity, which could translate to a large total addressable market for KDP to grow into.

Other recent moves in the space include the acquisitions of C4 and Black Rifle Energy, as well as a distribution agreement with Nutrabold for its Bloom RTD energy brand. The company is using a similar playbook in energy that it used to grow share in premium water. 

“Together, each of these brands can work in complementary ways to address consumer needs while driving greater scale in the category and across our DSD infrastructure,” said Cofer.

Also read: KDP Expands DSD Operations With Kalil Bottling Acquisition

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Ghost

More About Ghost and the Acquisition

Cofer described Ghost as a young, versatile, and founder-led company, noting that they have an approximately $0.5 billion portfolio and more than quadrupled in size over the last three years. A fast-growing brand in the category due to its unique brand identity, Cofer pointed to Ghost's distinctive flavors and packaging, cross-occasion appeal, and strong consumer engagement, including on-premise, as draws. 

The transaction includes a phased approach ending in full acquisition in the next four years if terms and conditions are met — first an initial 60% stake for $990 million and the remaining 40% in 2028 for a not-yet-disclosed amount that will be based on Ghost’s 2027 financial performance. 

Keurig Dr Pepper will also invest up to $250 million to transition the energy drink company’s existing distribution agreements so KDP can sell and distribute through its direct-store-delivery network.

Ghost co-founders Dan Lourenco and Ryan Hughes will continue to lead the company, now as part of Keurig Dr Pepper’s U.S. refreshments beverages business. 

The deal is expected to finalize by early 2025.

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