PepsiCo in Talks to Acquire Owner of Vita Coco Coconut Water, Say Sources

Beverage giant PepsiCo is reportedly looking to acquire coconut water brand Vita Coco’s parent company All Market Inc, according to a Reuters report. The proposed deal is just the latest in a string of efforts to diversify the company’s offerings as soft drink sales continue to decline.

All Market has been looking to sell the company for around $1 billion, but PepsiCo has offered less than asking, according to anonymous sources. As with any M&A transaction, they also said that there’s no guarantee that the negotiations will end in a deal.

Vita Coco provided no comment on this story. PepsiCo did not respond to a request for comment.

Coconut water has grown in popularity in recent years, with US sales of the beverage totaling $778 million in 2015, according to statista. Vita Coco is the leader in this market with sales reaching over $372 million in the same year.

All Market has benefited from celebrity investment, with Madonna, Mathew McConaughey and Demi Moore all buying shares in the company. Vita Coco products – including coconut water and coconut oil – are available in 30 countries.

In 2014, Red Bull China acquired a 25 percent stake in All Market. The deal also allowed Vita Coco to take advantage Red Bull’s distribution network, making the brand of coconut water available in the country for the first time.

Last year, PepsiCo acquired fermented tea manufacturer KeVita. The California-based drinks company offers three product lines of probiotic beverages, like kombucha, which are sold at health food and grocery stores throughout the US.

Along with owning its namesake Pepsi-Cola, the food and beverage manufacturer’s portfolio also includes brands like Gatorade, Tropicana and Quaker. In 2015, PepsiCo reported revenues of over $63 billion making one of the world’s top 100 companies.