PepsiCo increases its stake in Celsius Holdings in a deal that includes Celsius acquiring brand rights to Rockstar. PepsiCo now holds around 11% of Celsius and will pay $585m for 5% convertible preferred stock. Celsius gains the Rockstar Energy brand in the US and Canada while PepsiCo retains international rights.

As part of the agreement, PepsiCo will manage distribution of the Alani Nu brand in the US and Canada, acquired by Celsius in February for $1.8bn. PepsiCo also plans to appoint an additional director to Celsius’ board. The companies aim to scale the energy drink portfolio with a unified commercial strategy.

PepsiCo initially acquired an 8.5% stake in Celsius in 2022 for $550m, leading to US distribution of Celsius products. The recent deal signifies PepsiCo’s long-term brand portfolio growth strategy. The collaboration aims to create a stronger multi-brand energy portfolio to cater to diverse consumer groups.

The agreement allows Celsius to shape the strategic direction of the unified energy portfolio, focusing on planogram design and promotional execution. PepsiCo aims to expand distribution, streamline commercial strategy, and reach different consumer cohorts. The partnership is set to enhance the Alani Nu brand’s geographic reach and foodservice penetration.

The addition of Rockstar to Celsius’ portfolio is expected to appeal to a broader consumer base with varied tastes and lifestyles. The collaboration between PepsiCo and Celsius aims to deliver greater innovation, execution, and sustained brand growth. The companies believe the partnership positions them well for future success in the energy drink market.

Read more at Yahoo Finance: PepsiCo ups stake in Celsius Holdings