PepsiCo announced a $550 million investment in energy drink maker Celsius Holdings as part of a long-term distribution deal.
With PepsiCo as its preferred distribution partner, Celsius expects to gain more shelf space in existing retailers and expand into more independent stores, including gas stations. Pepsi will assist with the distribution starting August 8.
Pepsi’s investment in Celsius equates to a minority stake of roughly 8.5 percent in the company. The food and beverage giant will also nominate a director to serve on Celsius’ board.
Celsius, which was founded in 2005 and publicly held, reported explosive growth for its energy drinks during the pandemic. In the first quarter, its U.S. revenue increased 217 percent to $123.5 million.
PepsiCo, the parent of Mountain Dew and Gatorade, paid $3.85 billion in 2020 to buy Rockstar Energy, another energy drink.
