Priced at over 7 billion! Amazon sells itself to industry giants

Another big Amazon brand has been acquired!

Ghost was acquired by a beverage giant!

Recently, Amazon's best-selling Ghost was acquired by beverage company Keurig Dr Pepper Inc. (hereinafter referred to as KDP) for over US$1 billion.

Under the terms of the agreement, KDP will acquire 60% of Ghost's shares for approximately US$990 million (approximately RMB 7.2 billion). The acquisition is expected to be completed by the end of 2024 or early 2025. The remaining 40% of the shares will be acquired in 2028.

Following the acquisition, Ghost will continue to be led by co-founders Dan Lourenco and Ryan Hughes and will operate as part of Keurig Dr Pepper Inc. in the United States.

It is worth mentioning that this acquisition is Keurig’s largest deal since Keurig acquired Dr Pepper Snapple Group for nearly US$19 billion in cash in 2018.

Ghost was founded in 2016 and is headquartered in Nevada, USA. Ghost started out as an energy drink company, and its product line includes drinks of various flavors and types. Ghost is positioned as a sports nutrition company that advocates a fashionable lifestyle. The company stands out in the energy drink market with its unique brand image, innovative flavors and eye-catching packaging. It has outstanding performance in the energy drink category on e-commerce platforms such as Amazon, and has multiple hot-selling SKUs .

Ghost pays close attention to consumers' demands for the nutritional value and ingredients of beverages. As consumers' health awareness increases, Ghost has also developed protein and supplement powders that meet consumer needs, seizing market opportunities.

Ghost also launched two new protein cereal products through a partnership with General Mills: Ghost Protein Cereal “Peanut Butter” and Ghost Protein “Marshmallow.”

Ghost's net sales have doubled over the past three years , demonstrating strong market growth potential.

What is the plan behind the acquisition of Ghost?

The company that made this big acquisition of Ghost is also quite powerful.

Keurig Dr Pepper Inc. is one of the leading companies in the North American beverage market. The company was formed by the merger of Dr Pepper Snapple Group and Keurig Green Mountain.

Among them, Dr Pepper Snapple Group was founded in 1885 and has a history of 100 years. The company owns many iconic American brands such as 7-Up, Dr Pepper, Yuquan Soda, Snapple, A&W, Mott's and Sunkist.

Keurig Green Mountain was founded in 1981. Its main business is the production of Keurig coffee machines and matching K-cup coffee. The company was successfully listed on the NASDAQ as early as 1993.

Currently, KDP 's brands include Dr Pepper, 7UP, Snapple, A&W Root Beer, Sunkist, Canada Dry, etc. , providing a total of more than 125 private brands, franchise brands and partner brands. Products include carbonated beverages, juice drinks, tea drinks, coffee drinks and bottled water .

After years of development, KDP has taken a leading position in the coffee and beverage industry with its extensive product portfolio and strong brand influence . Its main competitors include Nestlé, Coca-Cola Company and PepsiCo. At present, the company's revenue has exceeded 10 billion US dollars.

As the company has grown rapidly, KDP has made several important acquisitions in addition to the acquisition of Ghost.

1. The two groups merged to form Keurig Dr Pepper

The first is the merger of the two giants mentioned above. In 2018, Dr Pepper Snapple Group and Keurig Green Mountain merged to form Keurig Dr Pepper Inc. This merger created a new listed company with annual sales of tens of billions of dollars.

2. Acquisition of beverage company Bai Brands

On November 22, 2016, KDP announced that it would acquire beverage company Bai Brands for $1.7 billion in cash, of which the purchase price included $400 million in tax benefits.

KDP acquired a minority stake in the company in 2015 for $15 million.

3. Acquired shares in energy drink company Nutrabolt

On December 8, 2022, KDP announced that it would invest $863 million in cash in energy drink company Nutrabolt and acquire a 30% stake in Nutrabolt. This acquisition makes KDP the largest shareholder of Nutrabolt.

4. Acquired a minority stake in non-alcoholic beer company Athletic Brewing

In 2022, KDP acquired a minority stake in non-alcoholic beer company Athletic Brewing for $50 million.

5. Acquisition of coffee brand La Colombe

In 2023, KDP announced that it would acquire a majority stake in coffee brand La Colombe for $300 million, becoming the second largest investor in La Colombe, second only to its major shareholder and Chobani founder Hamdi Ulukaya. At the same time, KDP also took over the manufacturing, distribution and licensing of La Colombe's products.

The multiple acquisitions also demonstrate KDP's strategy of business expansion and diversification in the beverage industry. Through acquisitions, KDP has also strengthened the company's market position in multiple segments of the beverage industry.

The acquisition of Ghost by KDP will enable it to compete more effectively with other industry giants, and Ghost's strong product power will also empower KDP to attract more consumers. KDP can also use Ghost's innovative methods and market influence to enhance its position in the energy drink field.

Energy drink market welcomes new development opportunities

The energy drink market in which Ghost operates has maintained a rapid growth trend in recent years.

According to Innova's market insight data, the global energy drink market size reached US$55.5 billion in 2023.

According to relevant research data, the global energy drink market is expected to grow by $40 billion from 2023 to 2027. During this period, the global energy drink market will grow at a compound annual growth rate of 8%.

Amid growing health awareness globally, the demand for energy drinks is growing, especially in the US market.

According to a survey by the National Center for Complementary and Integrative Health, approximately 30 % of American adults drink energy drinks, which in turn reflects a strong consumer base willing to explore energy drink products .

The top energy drink brands in the international market include Red Bull , Monster and Rockstar . In addition to the top brands, niche brands that provide organic and natural alternatives are constantly emerging in the functional beverage market .

As market competition intensifies, product innovation becomes crucial.

Currently, energy drinks can be finely divided according to multiple dimensions such as product type (non-alcoholic and alcoholic), type (inorganic and organic), use (before exercise, recovery and during exercise), ingredients, etc.

The accelerated pace of work and life has also made the consumer groups and scenarios of energy drinks more diversified . The consumer groups have become more extensive, and the consumption scenarios have also radiated from companies and sports venues to leisure and entertainment scenarios .

Driven by consumers' increased health awareness, product innovation and market segmentation, the energy drink market has ushered in huge development opportunities. Sellers can seize business opportunities, but at the same time, they must understand the local culture, consumption habits, laws and regulations, and many other issues when entering overseas markets, because consumers in different countries have different preferences for product packaging, taste, and functions.

Therefore, for sellers, it is necessary to base themselves in the local market and launch products that meet market demand. They should also continue to innovate according to market demand to create differentiated advantages.

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