Mergers and Acquisition

This project evaluates PepsiCo’s acquisition of Celsius Holdings, focusing on strategic fit, deal structure, and expected synergies. It outlines how the merger boosts PepsiCo’s presence in the health beverage space while accelerating Celsius’s market reach

Project Summary


Developed a full-scale M&A acquisition plan for PepsiCo to acquire Celsius Holdings, focused on expanding PepsiCo’s reach into the fast-growing, health-focused functional beverage market. The deal was designed to capitalize on rising demand for wellness products among Gen Z and millennial consumers and position PepsiCo as a leader in the performance energy drink segment.

Why Celsius?
Celsius stood out as the ideal acquisition target due to:

  • $1.3B+ in revenue with exponential growth and high margins

  • A strong foothold in the fitness-focused energy drink market

  • Complementary brand positioning aligned with PepsiCo’s long-term wellness strategy

  • Pre-existing minority ownership and distribution partnership with PepsiCo

Valuation & Deal Structure

  • Estimated enterprise value: $7.47B

  • Proposed offer: $9.34B (including 25% control premium)

  • Structured as a reverse triangular merger, combining 50% PepsiCo stock and 50% cash/debt

  • Designed to be tax-efficient, minimize integration risk, and maintain financial flexibility

  • Valuation based on market multiples benchmarked against peers (e.g. Monster, Bang Energy)

Synergies & Value Creation

  • $200M+ in projected synergies across supply chain, marketing, and operations

  • $45M in CapEx savings via consolidated production (e.g. Riverside facility)

  • $39M in recurring savings from logistics, HR, and IT integration

  • Strong distribution and marketing boost via PepsiCo’s global DSD network

  • Long-term free cash flow uplift from integration and scaling

Integration Plan

  • Celsius retains brand identity and core innovation team to preserve consumer loyalty

  • Production transitions to PepsiCo facilities, streamlining operations and avoiding new CapEx

  • Marketing gains access to PepsiCo’s data-driven infrastructure and ad spend

  • Gradual culture blending, maintaining Celsius’s agility within PepsiCo’s global structure

Strategic Rationale
This deal significantly strengthens PepsiCo’s market share in the $165B+ global functional beverage market. By acquiring Celsius, PepsiCo accelerates its presence in a high-growth segment, improves innovation speed, and responds directly to health-conscious consumer demand. The structure ensures long-term value creation, operational efficiency, and competitive insulation.