Coca-Cola Eying Monster Beverage Acquisition
Coca-Cola Inc., the world’s largest beverage manufacturer, is reportedly in discussions to acquire Monster Beverage Corp., the producer of its namesake energy drink. The report excited Monster shareholders to the tune of a 15 percent gain in its shares by 2 PM on Monday. Monster, with a market capitalization in excess of $11 billion, would represent Coca-Cola’s biggest purchase of an outside brand ever, and would give Coca-Cola a significant presence in the fast-growing energy drink market.
Spokesmen for both Coke and Monster declined to comment on the reports, saying that they do not discuss rumor or speculation, but a source who wished to remain anonymous confirmed that the talks are ongoing. Originally known as Hansen Natural, Monster went public in 1992 shortly after Rodney Sacks assumed the CEO position with the company. Sacks still owns about 7.3 percent stake in the company.
Of course, this isn’t the first time that rumors of a Coke purchase of Monster have surfaced, as it already distributes the beverages globally. Given Monster’s impressive growth rates, analysts have said for years that it would give Coke a great opportunity to instantly become a major player in the energy drink space. Since neither Coke nor Monster are willing to comment on any potential deal, there are not any details available about how much a deal might be worth.