Thursday, November, 26, 2020 08:15:45

The FTC (Federal Trade Commission) has reportedly approved the acquisition of Rockstar Energy by PepsiCo for the sum of $3.85 billion. The acquisition deal was announced by the companies in March during the novel coronavirus pandemic. PepsiCo is reportedly expected to close the acquisition deal in the coming days.

Headquartered in Harrison, New York, PepsiCo is an American multinational food, beverage, and snack corporation. On the other hand, Rockstar Energy is an energy drink company, which covers 14% of the energy drink market in the United States.

Apart from the recent deal with an energy drink company, PepsiCo also owns Mountain Dew Kickstart as well as holds a partnership with Starbucks energy drinks. Various regulators had been reviewing the recent acquisition deal to ensure that the competition in the market is not reduced. PepsiCo’s rivals include Monster and Red Bull, which are partly owned by non-alcoholic beverage concentrates and syrups company, Coca-Cola .

Sources familiar with the matter have stated that the market share of Rockstar has decreased from nearly 20% to less than 10%, which helped ease the concerns of the FTC.  Sources further added that Russell Weiner, founder of Rockstar and son of Michael Savage, a conservative talk show host, is not expected to play a key role following the closure of the recent acquisition or ownership of Rockstar by PepsiCo.

Furthermore, the deal will also enable PepsiCo to introduce new energy drinks. As a distributor of Rockstar, PepsiCo had been barred from manufacturing and marketing competing brands. Additionally, Kickstart, which is often considered as an energy drink produced by Mountain Dew, is being promoted as a breakfast beverage. It contains less caffeine as compared to other products such as Red Bull.

The Federal Trade Commission declined to respond to requests for comments on the recent deal.

Source credit:

https://nypost.com/2020/04/19/ftc-approves-pepsico-acquisition-of-rockstar-energy-for-3-85-billion/