Dr Pepper Snapple Group to acquire Bai Brands for $1.7bn

Dr Pepper Snapple has confirmed that it will acquire Bai Brands – the US maker of antioxidant-infused drinks – for $1.7 billion.

Bai’s portfolio of antioxidant-infused drinks was bolstered by Bai Black earlier this month.

The deal increases Dr Pepper Snapple’s holding in the Princeton, New Jersey-based company, after it bought an unspecific minority stake for $15 million last year.

‘Bai provides a strong platform to incubate and grow better-for-you beverages throughout the non-carbonated and carbonated beverage sectors’, Dr Pepper Snapple said. It is expected to generate approximately $425 million in net sales in 2017 and add an incremental $132 million to the group’s net sales expectation for 2017.

“We’re excited to welcome Bai into our family of great brands,” said Larry Young, president and CEO of Dr Pepper Snapple. “In a relatively short time, Bai has carved out a leadership position in the enhanced water category and has now extended that success into other fast-growing and profitable categories. We’re equally impressed with their innovation pipeline, which will continue to meet the needs of consumers seeking great tasting, low-calorie beverages with natural flavors and no artificial sweeteners.

“Bai has contributed greatly to our allied brand lineup since we began distributing it broadly in 2013. Adding it to the broad range of choices and options in our company-owned portfolio is a natural next step. Moving forward, we will empower Bai’s management team to continue the breakthrough and disruptive branding and innovation that have revolutionised their categories and work with them to put the brand in front of more consumers in more places.”

Bai has continued to strengthen its portfolio of antioxidant-infused beverages in recent weeks, with the launch earlier this month of Bai Black.

The line-up of sparkling and sugar-free drinks will be available across the US from January in a range of six flavours, all of which put a modern spin on classic sodas.

Bai’s products are infused with antioxidants from the coffee fruit. Each can of Bai Black, for instance, has 5kcal and no sugar or artificial sweeteners – but also contains about the same amount of caffeine as a cup of green tea.

Dr Pepper Snapple called Bai ‘one of the fastest growing beverage brands, offering a family of premium better-for-you beverages’.

Its product mix spans several high-growth beverage categories including enhanced water, carbonated flavoured water, coconut water and premium ready-to-drink teas. The highly profitable categories are projected to continue to grow worldwide for the foreseeable future, allowing Dr Pepper Snapple to meet growing consumer demand for better-for-you beverage options.

Bai Brands CEO Ben Weiss, who founded the company back in 2009, said: “Over the past seven years, Bai has proven to be an agent of change in a marketplace that is rapidly evolving. We’ve worked tirelessly to challenge the notion that better-for-you beverages can’t taste good. On our journey, we found a strong ally in Dr Pepper Snapple, an ally who embraced our mission to change the way the world drinks. Now, it only makes sense to continue our quest together. We are thrilled to join the DPS family and create a new path forward with infinite possibilities.”