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Photo: Justin Sullivan/Getty Images
PepsiCo has agreed to buy Las Vegas-based energy drink maker Rockstar for $3.85 billion.
Why it matters: This would give Pepsi a leg up on rival Coca-Cola in the growing energy drink space, and also would be Pepsi's first major acquisition since Ramon Laguarta took over as CEO in 2018.
- Coke does have a 19% stake in Monster, but it's been a contentious relationship that included a legal fight over Coke's decision to launch its own energy drink.
The big picture: Speaking of Monster, it's long been considered a takeover or merger target, and this should only intensify that talk. Monster shares climbed nearly 7% on the Rockstar report, pushing its market cap to over $35 billion.
The bottom line: "Rockstar, which PepsiCo already distributes, is one of a handful of major energy-drink brands. The entrepreneur Russell Weiner founded the company in 2001, when Rockstar was the first energy drink to come in now-ubiquitous 16-ounce cans. The number of energy-drink offerings has since exploded and begun edging out sodas for space in store coolers," writes the Wall Street Journal.
Go deeper: Betting on the future of breakfast