Vita Coco attracts US$20M investment ahead of planned IPO

US – Coconut water brand Vita Coco has attracted a US$20 million investment from an entity affiliated with Keurig Dr Pepper.  

The investment was made as a private placement, buying out an existing shareholder, Verlinvest Beverages, according to an updated S-1 filing with the Securities and Exchange Commission. 

The updated S-1 filing did not identify the investor except to note that it was “an entity affiliated with Keurig Dr Pepper.”   

The investment comes as Vita Coco moves a step closer toward its IPO which is expected to debut in October, this year.  

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The company, whose portfolio includes its namesake coconut drink as well as plant-based energy brand Runa, purified water Ever & Ever packaged in aluminum bottles, and protein-infused water Pwr Lift, is reportedly seeking a valuation of US$1.17 billion at a US$21 IPO price. 

At US$19.50, the mid-point of that range, the Keurig Dr Pepper entity is expected to own more than one million shares. 

Keurig Dr Pepper and Vita Coco have a history of working together with the latter being reported to account for 19% of Vita Coco’s total net sales in 2020. 

The company has also benefited financially by distributing Vita Coco’s brands amid an upswing in demand for better-for-you beverages.  

While little is known about the investor’s ties to Keurig Dr Pepper, analysts opine that it’s possible the beverage giant could ultimately decide to purchase Vita Coco if it continues to see strong sales in the company’s brands and remains optimistic about its future. 

Vita Coco is already doing well for itself on the performance front, reporting net sales of US$334 million for the 12 months ending June 30, a 17% increase from the same period a year earlier. 

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SEC filing also shows that the New York-based company posted a net income of US$33 million in 2020 compared to US$9 million in 2019.   

Keurig Dr Pepper certainly has an appetite for acquisitions with its  CEO Bob Gamgort telling Bloomberg recently saying that his company is looking at deals worth up to US$20 billion.  

Keurig Dr Pepper is seeking “move-the-needle but not bet-the-company type deals” in categories such as energy and alcoholic drinks, Gamgort told the wire service. 

In recent years, it purchased the majority of Bai Brands it didn’t already own for $1.7 billion and premium water brand Core Nutrition for $525 million.   

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