US – California-based energy drink giant Monster Beverage Corp, through its subsidiary, Blast Asset Acquisition LLC, has completed the acquisition of Bang Energy owner Vital Pharmaceuticals in a $362m deal.
The acquisition includes Bang’s performance beverages and related businesses and a beverage production facility located in Phoenix, Arizona, US.
The acquisition was possible after Judge Peter Russin, in his ruling, approve the settlement and sale — averting the shutdown of Bang Energy, which has faced an uncertain future after its board fired founder and former Chief Executive Officer Jack Owoc earlier this year.
As of June 30, it was unclear if the Federal Trade Commission would finish its review of information about the deal by the deadline.
The U.S. antitrust agencies require companies to turn over much more information about their transactions than before as they try to crack down on illegal mergers, adding months of review to proposed deals.
VPX Sports, which filed for bankruptcy in October after a California court awarded Monster Beverage US$293 million against Bang and its former CEO Jack Owoc, claimed the move would allow it to reorganize and regain market share from domestic rivals.
The company also created a new “decentralized direct store distribution (DSD)” network for the Bang Energy brand, which it hoped will enable it to recover to its “pre-Pepsi meteoric annual success”. However, Vital Pharmaceuticals kept on struggling to stay afloat in the market.
Rodney C Sacks, chairman and co-chief executive officer of Monster Beverage Corporation, said: “We are enthusiastic about the opportunities this acquisition presents to us and believe that the Bang brand will fit well within our broader portfolio of energy drink brands”.
Monster has a market capitalization of about US$59 billion and cash and cash equivalents of about US$3 billion, Monster Executive Vice President and Deputy General Counsel Paul Dechary said in a sworn statement the company has substantial resources to satisfy financial obligations under the Bang deal.
Hilton H Scholsberg, vice chairman and co-chief executive officer, pointed out that Bang Energy has a “distinct marketing position and loyal consumer base,” and that production will be increasing at the Phoenix facility to accommodate certain of the company’s other brands.
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