Daily Management Review

Coca-Cola buys sports drinks maker BodyArmor for $5.6bn


Coca-Cola has announced that it is buying BodyArmor, one of the largest producers of sports drinks.

Coca-Cola previously owned 15% of BodyArmor and will now be the sole owner of the company. The deal will be valued at $5.6 billion, bringing the total value of BodyArmor to $6.6 billion. This is the most expensive purchase of a single brand in Coca-Cola's history. BodyArmor will remain a separate company after the acquisition, with its headquarters still located in New York, and its current top management team will continue to run it.

Coca-Cola bought a 15 per cent stake in BodyArmor in 2018 for $300m, at which time the entire company was valued at $2bn. Earlier this year, Coca-Cola had already said it was in talks to acquire the remainder of the company, and The Wall Street Journal reported the purchase on Sunday, citing sources. BodyArmor was founded in 2011 and since then it has managed to become the second-largest sports drinks producer in the US - helped by a group of athletes among the company's shareholders, including several well-known US baseball and basketball players, who have helped promote the drinks. BodyArmor itself expects sales of its products to grow by 50% this year, to $1.4bn, compared with sales of just $250m in 2018.

The acquisition will help Coca-Cola expand its sports drinks portfolio and compete more effectively with PepsiCo in this area. Last year, Coca-Cola decided to nearly halve its brand portfolio as it shut down about 200 brands that were not popular and profitable enough.

source: wsj.com