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Israeli Firm Sodastream To Be Bought By Pepsi For $3.2 Billion

Israeli Firm Sodastream To Be Bought By Pepsi For $3.2 Billion
In an effort to seek avenues of moving into low sugar beverages, Pepsi has decided to buy one of the better-known brands of sparkling water.
SodaStream which is an Israeli firm that offers do-it-yourself seltzer makers is to be bought over by the soft drink giant for $3.2 billion, Pepsi announced on Monday. The company said that this move would help it to seek out ways of getting more into the business of offering healthier drinks compared to the high calorie soft drinks that it now manufactures and markets.
The products that are manufactured and offered by SodaStream are marketed as a healthier alternative for sugary sodas. This marketing approach is suits Pepsi’s aim of "making more nutritious products while limiting our environmental footprint," said Pepsi CEO Indra Nooyi in a statement. "Together, we can advance our shared vision of a healthier, more sustainable planet."
Pepsi has been slowly shifted towards healthier offerings by Nooyi who herself is slated to step down as the CEO of the company in October after serving in the position for more than a decade.  The primarily soft drinks manufacturing company has said that this strategy is key for the future of the company because of the increasing awareness of consumers towards healthier food habits. Ramon Laguarta, Pepsi's head of global operations will replace Nooyi as the next CEO.
According to the plan of action of Pepsi, its products would be split into three primary categories. The first would be Fun For You segment that would include the traditional, higher-calorie soft drinks and snacks. The second category would be the called the Better For You segment which would encompass diet drinks and lower-calorie snacks like such as potato chips that are baked rather than being deep-fried. And the third category would be called Good For You which would include foods such as Quaker Oats oatmeal, Sabra hummus and Naked Juice smoothies.
The health credential of Pepsi would be further boosted by the purchase of SodaStream. There has been a 320 per cent increase in the share prices of this Israeli company in the last four year alone ever since the company started to brand itself as a company that deals with sparkling water.
Pepsi would fund the acquisition from the cash it has in hand and the deal has already been approved by the boards of both the companies. The deal is expected to be closed by the end of January next year subject to it being cleared by the SodaStream shareholders through a vote and the gaining of some regulatory approvals.

Christopher J. Mitchell

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