Coca-Cola to fully acquire Gatorade rival BodyArmor for $5.6 billion

Coca-Cola Co said on Monday it would buy the remaining stake in BodyArmor it did not already own for $5.6 billion, as the soda maker amps up its sports drink portfolio to take on market leader, PepsiCo Inc’s Gatorade.

The deal marks a shift in strategy for the world’s largest beverage maker after it spent the last year offloading or discontinuing brands, including its own energy-drink brand, to focus on Coca-Cola sodas.

The deal, which values BodyArmor at about $6.59 billion, is Coca-Cola’s largest for a single brand; It comes about three years after the company bought British coffee chain Costa for $5.1 billion.

BodyArmor, which markets itself as electrolyte-filled energy recovery drink for athletes, currently makes about $1.4 billion in annual retail sales and has a 50% growth rate, Coca-Cola said. “It gives Coke a strong stable of products in the rapidly growing sports hydration category. It’s a nice premium brand that has opportunity for expansion over time,” Edward Jones analyst John Boylan said about BodyArmor that gained popularity after basketball star Kobe Bryant backed it in 2013.

via Reuters