PepsiCo to Buy SodaStream for $3.2 Billion, in Push for Healthier Options

PepsiCo announced Monday that it planned to buy SodaStream, the popular maker of home-carbonation machines, for $3.2 billion, as the beverage giant extends its bet on products that are not sugary sodas.

The deal is a late effort by Indra K. Nooyi, PepsiCo’s departing chief executive, to firmly steer the beverage company toward healthier snack and drink offerings. Under Nooyi it has shifted more and more attention to products like premium bottled water, baked food and veggie chips.

That strategy has drawn intense criticism at times, including from activist shareholders. But Nooyi has persisted, noting that sales at the company have grown 81 percent under her tenure.

The transaction announced Monday, PepsiCo’s biggest in years, also gives the company another potential source of revenue: refills of flavored syrups and carbon-dioxide gas, in what is often known as the razor-and-blades model. Yet in doing so, the company will try to make work what its big rival, Coca-Cola, could not do four years ago.

Under the terms of the deal, PepsiCo will pay $144 a share, nearly 11 percent higher than SodaStream’s closing stock price Friday. It is expected to close in January, pending approval by SodaStream’s shareholders.

The two companies have existing business ties, with PepsiCo having tested homemade versions of Pepsi and Sierra Mist using SodaStream machines in 2014.

Founded in Britain in 1903 by a gin distillery employee, what is now SodaStream was largely focused on making sodas at home. (“Get busy with the fizzy” was its longtime ad slogan in Britain.) It traded hands over the years, with Cadbury Schweppes, until it was acquired by an Israeli counterpart, Soda-Club, in 1996.

It was under that new ownership that SodaStream enjoyed a resurgence in popularity and went public in 2010. Perhaps most importantly for PepsiCo, SodaStream has emphasized in recent years its products’ ability to make flavored sparkling water rather than sodas.

That provides an important avenue for PepsiCo to tap into a growing market, particularly as brands like La Croix have exploded in popularity. (PepsiCo has already unveiled offerings like Bubly that take aim at the sector.)

Buying SodaStream brings another advantage: It would give PepsiCo a way to address consumer worries about the proliferation of disposable plastic, including in drinks containers. In its news release Monday, the company noted that the acquisition was part of its Performance with Purpose initiative, which focuses on environmentally friendly and cost-effective beverage offerings.

“PepsiCo is finding new ways to reach consumers beyond the bottle,” said Ramon Laguarta, Nooyi’s successor as the company’s chief executive. “Today’s announcement is fully in line with that strategy.”

Coke tried to make the at-home beverage business work in 2014 when it bought a stake in what was then Green Mountain Coffee Roasters and introduced a soft-drink product for that company’s Keurig machines. The product was scrapped two years later because of poor sales.