US – Keurig Dr Pepper (KDP) is investing US$863 million in Nutrabolt, a fast-growing, global active health and wellness company, to supercharge C4 Energy’s current growth trajectory by accelerating household penetration, enhancing distribution, and strengthening overall commercial capabilities.
Since its founding 20 years ago, Nutrabolt, the maker of C4 and Xtend energy drinks, has set out to meet the discerning needs of performance athletes and fitness enthusiasts while appealing beyond this core group to include consumers around the globe who are making healthy, active living a daily priority, according to the partners.
Nutrabolt’s portfolio, which is distributed in over 125 countries, is sold through company-owned DTC platforms, Amazon, and other third-party e-commerce marketplaces, and is also available at leading retailers across the US.
The Investment will give KDP a 30% stake in the global active health and wellness company with an option to increase its holdings under various capital-raising scenarios. KDP will have representation on the Nutrabolt board.
Under the long-term sales and distribution agreement, KDP will sell and distribute C4® Energy in the vast majority of KDP’s company-owned direct store distribution territories, which is expected to meaningfully increase retail availability and household penetration for the brand.
Nutrabolt will continue to distribute C4 Energy directly or through its existing distribution network to the specialty, health club, and fitness channels and will continue to work with some of its existing beverage distributors in certain markets.
Following the partnership, Keurig Dr. Pepper anticipates the partnership to add to its 2024 earnings since Nutrabolt expects its sales to exceed US$650 million next year.
Keurig Dr Pepper’s Chairman and CEO Bob Gamgort stated: “This partnership represents a win-win transaction between our two companies. KDP gains a significant presence in the rapidly growing performance energy drink market and Nutrabolt gains access to a strategic investor with extensive sales and distribution capabilities to further accelerate its growth.”
We believe that bringing together the resources, talent, and expertise of both companies will accelerate innovation and growth and drive significant value creation over time.”
The transition of C4 Energy distribution to KDP will occur during 2023, which is expected to be a transition and investment year, with limited impact on KDP’s financial results until 2024, when KDP expects the strategic partnership to become accretive to its financial results.
Companies have been scrambling for a bigger piece of the US energy-drink market that totals almost US$19 billion in annual sales and is projected to witness a CAGR of 7.63% during the forecast period (2022-2027).
Earlier this year PepsiCo agreed to pay US$550 million for a stake in Celsius Holdings Inc. as part of a long-term strategic distribution agreement.