PepsiCo to Acquire Rockstar Energy Beverages

PepsiCo has entered into an agreement to acquire Rockstar Energy Beverages for $3.85 billion.

The agreement, expected to close in the first half of this year, will also provide $700 million of payments related to future tax benefits associated with the transaction, payable over up to 15 years.

PepsiCo, which has had a distribution agreement with Rockstar in North America since 2009, also owns the Mountain Dew Kickstart energy brand, as well as GameFuel and Amp.

"As we work to be more consumer-centric and capitalize on rising demand in the functional beverage space, this highly strategic acquisition will enable us to leverage PepsiCo's capabilities to both accelerate Rockstar's performance and unlock our ability to expand in the category with existing brands such as Mountain Dew," said Ramon Laguarta, PepsiCo chairman and CEO, in a statement. "Over time, we expect to capture our fair share of this fast-growing, highly profitable category and create meaningful new partnerships in the energy space."

"We have had a strong partnership with PepsiCo for the last decade, and I'm happy to take that to the next level and join forces as one company," added Russ Weiner, Rockstar founder. "PepsiCo shares our competitive spirit and will invest in growing our brand even further. I'm proud of what we built and how we've changed the game in the energy space."

PepsiCo is No. 3 on the CGT Top 100 Consumer Goods Companies of 2019 list. It generated more than $67 billion in net revenue in 2019 with such brands as Frito-Lay, Gatorade, Pepsi-Cola, Quaker and Tropicana.