Keurig Dr Pepper (KDP) announced a definitive agreement to acquire Ghost Lifestyle and Ghost Beverage, marking a significant move into the fast-growing energy drink space.
The deal, valued at approximately $990 million, will see KDP initially acquire a 60% stake in Ghost, with the remaining 40% expected to be acquired by 2028.
Founded in 2016, Ghost has quickly established itself as a prominent player in the energy drinks market, particularly with its flagship product Ghost Energy.
The brand has quadrupled its net sales over the past three years due to its unique branding, distinct flavors and strong consumer engagement. Ghost Energy is recognized as one of the fastest growing brands in the energy sector, particularly appealing to younger consumers.
“Ghost is a differentiated brand with great growth potential, and we are excited to partner with the founders to take the business to the next level,” said Tim Cofer, CEO of KDP. “This acquisition strengthens our position in the attractive energy drinks category.” Through disciplined deal structures, we accelerate the evolution of portfolios toward consumer-preferred growth-driving areas. ”
Cofer continued, “The energy sector is poised for continued long-term growth, and KDP expects to increasingly capture it through our platform-based approach. KDP’s portfolio of complementary energy brands , tailored to unique consumer needs, and the combination of these products will deliver significant growth and economies of scale across our DSD portfolio.”
Under the terms of the agreement, Ghost will remain under the direction of co-founders Dan Lourenco and Ryan Hughes and will operate within KDP’s U.S. Refreshment Beverages division. This acquisition strengthens Ghost’s market reach by leveraging KDP’s existing sales capabilities.
The first phase of the transaction is expected to close in late 2024 or early 2025, subject to customary closing conditions. KDP plans to consolidate Ghost’s financial results upon completion and expects the acquisition to be neutral to slightly accretive to adjusted earnings per share beginning in 2025.
In addition to the initial investment, KDP has earmarked up to $250 million to transition Ghost Energy’s distribution agreement, enabling its integration into KDP’s direct store delivery network. The move is expected to streamline operations and increase Ghost’s market penetration.
The energy drink category is becoming increasingly competitive as consumers seek innovative and functional beverages. KDP’s acquisition of Ghost is seen as a strategic response to these market trends, positioning the company to capture a larger share of this lucrative sector.
KDP plans to provide further insight on this acquisition during its 2024 third quarter earnings conference call scheduled for later today.
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