PepsiCo to buy Israel's SodaStream in US$3.2b deal

The Soda Stream acquisition will probably be the last big move by Pepsi Co chief executive officer Indra Nooyi who steps down in October

PepsiCo buys Sodastream for $3.2bn

Geneva: PepsiCo Inc. said it agreed to buy SodaStream International Ltd for $3.2 billion to gain the Israeli company's at-home soft-drink-making technology.

Nooyi said SodaStream is an extraordinary company offering consumers the ability to make great-tasting beverages while reducing the amount of waste.

"PepsiCo and SodaStream are an inspired match", Nooyi said in a statement Monday. Such carbonated drinks often mimic the taste and consistency of store-bought, more sugary drinks-like Pepsi.

"Together, we can advance our shared vision of a healthier, more sustainable planet", she added.

"Nobody has come here to obtain, to take, to close down and build a copy anywhere else", Birnbaum said at a news conference in Tel Aviv that was attended by incoming PepsiCo Chief Executive Ramon Laguarta. PepsiCo said the move is also meant to boost sustainability because consumers fill reusable bottles. PepsiCo's move can be seen in the context of global food and drinks companies increasingly looking to acquire companies with more health-conscious credentials. The ecommerce-only brand was fostered as a startup but the drinks giant has high hopes for it's reach after launching it in Brazil, the U.S., the United Kingdom and Europe. It said the purchase was another step in its bid to "promoting health and wellness through environmentally friendly, cost-effective and fun-to-use beverage solutions". "We are honoured to be chosen as PepsiCo's beachhead for at home preparation to empower consumers around the world with additional choices".

The acquisition also is a pitch to consumers concerned about mounting waste from soda cans and plastics in landfills around the world, since SodaStream employs reusable bottles.

In a note to investors, Bonnie Herzog, managing director of equity research for Wells Fargo Securities, said she thinks the move can help accelerate PepsiCo's "ongoing strategic shift towards adding healthier options across its product mix and.complement the company's growing water portfolio - including its recently launched bottled sparkling water brand Bubly".

If regulators approve the deal, it is expected to be finalised by January 2019, subject to a vote by Sodastream shareholders.

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