Thursday, November 21, 2024

Keurig Dr Pepper to acquire energy drink business GHOST

Keurig Dr Pepper has entered into a definitive agreement to acquire GHOST Lifestyle LLC and GHOST Beverages LLC (collectively GHOST).

Founded in 2016, GHOST is a lifestyle sports nutrition business with a portfolio anchored by GHOST Energy, a ready-to-drink energy brand.

GHOST’s net sales have more than quadrupled over the past three years, and GHOST Energy is one of the fastest-growing brands in the energy category, characterized by its unique identity, distinctive flavors and packaging, and strong consumer appeal.

Under the terms of the agreement, KDP will initially purchase a 60% stake in GHOST, which will be followed by the acquisition of the remaining 40% stake in 2028. GHOST will continue to be led by co-founders, Dan Lourenco and Ryan Hughes, and will operate as part of KDP’s U.S. Refreshment Beverages segment.

The proposed transaction will substantially enhance KDP’s presence in the energy drink category, extending its reach to new consumers. KDP’s energy portfolio will now include multiple, powerful brands spanning lifestyle, performance, and other major occasions in the category. In addition to ready-to-drink energy, GHOST also has a presence in supplements and emerging positions in other liquid refreshment beverages.

Tim Cofer, KDP Chief Executive Officer, said: “GHOST is a differentiated brand with significant growth potential, and we are excited to partner with its founders to take the business to the next level. This acquisition strengthens our position in the attractive energy drink category, accelerating our portfolio evolution toward consumer-preferred, growth-accretive spaces through a disciplined deal structure.”

Cofer continued: “The energy category is poised for continued long-term growth, which KDP expects to increasingly capture through our platform-based approach. KDP’s portfolio of complementary energy brands is aligned against distinctive consumer need states, and, together, these offerings will unlock significant growth and scale benefits across our entire DSD portfolio.”

GHOST CEO and Co-Founder Dan Lourenco added: “We could not be more excited to build the future of GHOST together with KDP. As we thought about our company’s next chapter, KDP’s track record of cultivating disruptive brands, similar challenger mindset, and shared vision for the energy category and beyond made it the right home for our brand and team.

“We are excited to pair KDP’s insights and capabilities with our products and people and know that together we will continue to scale and build GHOST towards our vision of a 100 year brand.”

In the first stage of the transaction, the company will make an initial cash investment of approximately $990 million in exchange for a 60% ownership stake in GHOST. In the second stage of the transaction, KDP will purchase the outstanding 40% stake in 2028 at a pre-negotiated valuation scale that will reflect GHOST’s 2027 financial performance.

Starting in mid-2025, KDP also expects to invest up to $250 million to transition GHOST Energy’s existing distribution agreements ahead of beginning to sell and distribute the brand through the company’s direct store delivery network.

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