PepsiCo buys fizzy drink maker SodaStream for $3.2bn

The Soda Stream acquisition will probably be the last big move by Pepsi Co chief executive officer Indra Nooyi who steps down in October

Under the deal, announced before the market opened, PepsiCo has agreed to acquire all outstanding shares of SodaStream for $144.00 per share in cash, which represents a 32 percent premium to the 30-day average price.

SodaStream markets itself as a health-conscious maker of alternatives to cola drinks and PepsiCo's purchase is in line with the company's ongoing pivot of recent years towards drinks and snacks not as associated with the kind of mass sugar content as the Pepsi drink previously has been.

SodaStream sells machines that carbonate tap water.

The keys to Sodastream's business relies on selling flavour packs that allow consumers to add their own mixes to the carbonated water.

"From breakthrough innovations like Drinkfinity to beverage dispensing technologies like Spire for foodservice and Aquafina water stations for workplaces and colleges, PepsiCo is finding new ways to reach consumers beyond the bottle, and today's announcement is fully in line with that strategy".

SodaStream shares have jumped 49 per cent this month after the company boosted its forecast for revenue growth this year to 23 per cent and reported first-half figures that beat estimates.

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"Daniel and his leadership team have built an extraordinary company that is offering consumers the ability to make great-tasting beverages while reducing the amount of waste generated", Nooyi said in the statement. The company's fizzy drink maker was a hot item in Britain in the 1970s and 80s, Reuters writes, "but its popularity faded as bottled sodas became cheaper".

The SodaStream acquisition will probably be the last big move by PepsiCo chief executive officer Indra Nooyi who steps down in October.

Speculation about Pepsi or Coca-Cola buying SodaStream has bubbled for years.

Three years ago, SodaStream shut down its West Bank factory amid global boycott calls and opened a sprawling new factory deep in Israel's Negev Desert instead. SodaStream has argued that boycotts and protests have hurt Palestinians more than helped them.

Goldman Sachs acted as financial advisor to PepsiCo and Centerview also acted as financial advisor to PepsiCo.

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