Beverage companies are no longer just relying on popular soda brands, but are in a competitive race to stay up to date with trends like seltzer/sparkling water, sustainable packaging, coffee brands and healthier, sugar-free drinks.
Keurig Dr. Pepper (KDP), the result of Keurig’s merge with Dr. Pepper earlier in the year, jumped onto the trend wagon and announced it had entered into an agreement to acquire CORE Nutrition LLC at a value of $525 million.
KDP CEO Bob Gamgort stated in a press release, “CORE has been a valued and successful allied brand partner, and we are pleased that this on-trend beverage will become part of our owned KDP family of brands. Our sales and distribution capabilities have helped fuel significant growth for the CORE portfolio. Through this transaction we intend to realize the full growth potential for the business.”
CORE Nutrition LLC is a beverage company that delivers organic and artificial free drinks. It fits into the better-for-you segment and healthier options trend that many consumers are interested in. CORE’s portfolio includes CORE Hydration, a premium, nutrient-enhanced bottled water and CORE Organic, USDA-certified organic enhanced fruit hydration, both currently distributed by Keurig Dr. Pepper.
CORE brands will continue to be distributed by Keurig Dr. Pepper
According to data from the International Bottled Water Association (IBWA) and the Beverage Marketing Corporation (BMC), bottled water is the number one beverage in the U.S. by volume with sales of $18.4 billion in 2017, over passing soft drinks.
Lance Collins, founder of CORE, said, “We created CORE to meet the increasing desires for innovative, enhanced water offerings with functional benefits for today’s modern consumer. KDP has been an outstanding partner for CORE and I am certain that, under its ownership, CORE will continue to see tremendous long-term success. I am a strong supporter of the KDP strategy and business model and am looking forward to being a shareholder in the company.”
The deal is expected to close at the end of 2018, with both CORE Hydration and CORE Organic continuing to be distributed through KDP’s company-owned direct store delivery network and independent distributor network.
This acquisition means the continuation of competition among the big-league beverage companies as they try to meet consumer demands and growing trends. Last month, PepsiCo acquired SodaStream International, a sparkling water maker, for $3.2 billion. Earlier, Coca Cola had purchased mineral water company Topo Chico and more recently, U.K. coffee chain Costa.