Celsius Holdings, Inc. and PepsiCo, Inc. have announced a significant expansion of their long-term strategic partnership, aimed at optimizing their combined energy drink portfolio and enhancing market reach. Under the agreement, Celsius Holdings’ Alani Nu brand will transition into the PepsiCo distribution system across the U.S. and Canada, broadening its retail presence and access to new channels. In a parallel move, Celsius Holdings has acquired the Rockstar Energy brand in the U.S. and Canada from PepsiCo, while PepsiCo retains international rights to Rockstar. As part of the transaction, PepsiCo has acquired US$585 million in newly issued convertible 5 percent preferred stock from Celsius Holdings, raising its ownership stake to approximately 11 percent on an as-converted basis and entitling it to nominate an additional director to Celsius Holdings’ board. At the time of the announcement, the US$585 million investment equated to approximately C$797 million. Celsius Holdings will now serve as PepsiCo’s strategic energy lead in the U.S., managing the CELSIUS, Alani Nu, and Rockstar Energy brands, while PepsiCo will lead distribution for the Celsius Holdings portfolio in both the U.S. and Canada.

The transaction was supported by a group of prominent advisors: UBS Investment Bank and Goldman Sachs & Co. LLC acted as co-financial advisors to Celsius Holdings, with Davies Ward Phillips & Vineberg LLP, Freshfields US LLP and Greenberg Traurig, P.A. as legal counsel. For PepsiCo, Centerview Partners LLC served as lead financial advisor, BofA Securities as financial advisor, Cravath, Swaine & Moore LLP as legal counsel, and McCarthy Tétrault LLP as Canadian legal advisor