PepsiCo will spend $3.2 billion to acquire Israel-based SodaStream as Indra Nooyi finishes her term as the company’s head of global operations.
According to a CNN Money report, the move is in line with Nooyi’s steps to help align Pepsi with consumers’ focus on health over the past decade. In a statement, she said the companies share a common goal of “making more nutritious products while limiting our environmental footprint. Together, we can advance our shared vision of a healthier, more sustainable planet.”
“PepsiCo and SodaStream are an inspired match,” Nooyi’s statement continued. It’s “an extraordinary company that is offering consumers the ability to make great-tasting beverages while reducing the amount of waste generated.”
Two years ago SodaStream rebranded itself as a sparkling water company — a move that increased the company’s stock by 320 percent. According to USA Today’s report, the device allows people to turn their own tap water into sparkling water in moments. In addition, flavors and syrups can turn the carbonated water into an array of additional tasty drinks in moments, and consumers have more control over sugar amounts and flavors with the in-home soda making device. The company sells its products in 80,000 stores throughout 45 countries.
The deal, which was approved by both companys’ boards in unanimous votes, should close in January if everything goes smoothly, which is after Nooyi’s planned October exit as the company’s head, which she announced earlier this month. Replacing her is Ramon Laguarta who will become the brand’s sixth CEO. Pepsi agreed to purchase SodaStream at $144 per share. Friday, SodaStream closed at $129.85, but shares jumped to $143.02 in pre-market trading on Monday. PepsiCo’s shares remained relatively unchanged by the news.
During Nooyi’s 12 years as PepsiCo’s head, she managed to grow sales by a whopping 80 percent by splitting the company’s offerings into Fun For You, Better For You, and Good For You categories, which consumers appeared to respond to. Moving away from the main product of sugary sodas helped the company as consumers changed their habits to become more health conscious than ever over the past decade. For 24 years, Nooyi has worked at the company.
In a statement about her departure, which will be complete in early 2019, Nooyi said, “Leading PepsiCo has truly been the honor of my lifetime, and I’m incredibly proud of all we have done over the past 12 years to advance the interests not only of shareholders, but all our stakeholders in the communities we serve.”