PepsiCo Bolsters Celsius Stake with $585M Deal, Gains Control of US Energy Drink Portfolio

PepsiCo has raised its stake in Celsius Holdings to 11% with a $585 million investment in preferred stock. The deal allows Celsius to take control of the US energy drink portfolio, including PepsiCo's Rockstar Energy and Alani Nu brands. PepsiCo will retain international rights to Rockstar and nominate a director to Celsius' board. The partnership brings their combined US market share to 20%, positioning them to compete against Red Bull and Monster Beverage. Celsius stock has more than doubled in 2025.

PepsiCo Inc. has significantly increased its investment in Celsius Holdings Inc. by acquiring $585 million worth of convertible preferred stock, elevating its ownership to 11% [1]. This strategic move allows Celsius to gain control of the U.S. energy drink market, including PepsiCo's Rockstar Energy and Alani Nu brands. In return, Celsius will manage the U.S. distribution of these brands, while PepsiCo will continue to own the Rockstar Energy brand internationally and nominate a director to Celsius' board [2]. The partnership positions the combined entities to hold a substantial 20% market share in the U.S. energy drink sector, challenging industry leaders such as Red Bull and Monster Beverage [1].

The deal also involves the integration of Celsius' Alani Nu brand into PepsiCo's distribution system, which will provide access to new channels and broader distribution, potentially accelerating the brand's growth [2]. This strategic alignment leverages the strengths of both companies to create a robust energy drink portfolio in the U.S. market.

Celsius' stock has seen a remarkable performance in 2025, more than doubling its value, reflecting investor confidence in the strategic partnership [2]. The company's shares closed at $59.69 on Thursday, July 01, 2025, with a market value of approximately $15.4 billion [1].

The partnership is part of PepsiCo's broader strategy to adapt to consumer trends toward healthier, less processed foods and beverages. The acquisition of Rockstar Energy and the integration of Alani Nu into its distribution network are steps to strengthen PepsiCo's position in the energy drink market [1].

The deal highlights the potential for further collaboration between the two companies, with analysts speculating that the increased stake could be a precursor to a full takeover of Celsius by PepsiCo [1]. However, Celsius CEO John Fieldly declined to address these speculations, stating that the agreement is a natural evolution of their relationship and aligns with industry precedents [1].

References:
[1] https://finance.yahoo.com/news/pepsico-said-boost-stake-celsius-103228954.html
[2] https://www.ainvest.com/news/celsius-holdings-surges-5-76-intraday-rally-fueling-momentum-2508/