Keurig Dr Pepper is spending more than $1 billion on a growing energy drink.
The beverage maker announced an agreement to acquire Ghost, a lifestyle sports nutrition business with a portfolio anchored by a leading ready-to-drink energy brand. The target company’s sales have more than quadrupled over the past three years.
KDP has been investing in growth as it seeks to bolster its opportunities in promising categories. For example, it unveiled an equity investment in 2022 in Nutrabolt, a global active health and wellness company with a portfolio of brands, including C4 Energy.
KDP will initially purchase a 60% stake in Ghost and the remaining 40% stake in 2028. In the first stage of the transaction, KDP will make a cash investment of roughly $990 million in exchange for a 60% ownership stake. The first step is expected to close in late 2024 or early 2025.
Starting in mid-2025, KDP expects to invest up to $250 million to transition Ghost Energy’s distribution agreements before beginning to sell and distribute the brand through KDP’s direct store delivery network. In the second stage of the transaction,
KDP will purchase the remaining stake “at a pre-negotiated valuation scale” that reflects Ghost’s 2027 financial performance.
“Ghost is a differentiated brand with significant growth potential, and we are excited to partner with its founders to take the business to the next level,” Tim Cofer, KDP chief executive officer, said in a statement. “This acquisition strengthens our position in the attractive energy drink category, accelerating our portfolio evolution toward consumer-preferred, growth-accretive spaces through a disciplined deal structure.”
Ghost will continue to be led by co-founders, Dan Lourenco and Ryan Hughes, and will operate as part of KDP’s U.S. Refreshment Beverages segment.
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