The Coca-Cola Co., which has been looking to expand its water and energy drink portfolio, said Friday it has agreed to buy Vitamin Water maker Glaceau in a cash deal valued at $4.1 billion.
The world's largest beverage maker said the agreement to acquire Energy Brands Inc., known as Glaceau, provides Atlanta-based Coca-Cola (KO) with a strong platform to grow its "active lifestyle" beverages.
The transaction is expected to boost Coca-Cola's earnings per share in the first full year following completion of the acquisition.
Formed in 1996 and based in Whitestone, N.Y., Glaceau is the maker of Vitamin Water, Fruit Water, SmartWater and Vitamin Energy.
After the deal closes — expected this summer — Glaceau will operate as a separate business unit within Coca-Cola's North America segment. The deal is subject to regulatory review. The boards of both companies have approved the transaction.
Glaceau was attractive to Coca-Cola because of its position in the enhanced water and energy drink categories, which Coca-Cola is betting will make up a large portion of the beverage industry's growth in North America through 2010.
Coca-Cola said Glaceau's top three executives intend to lead the business for at least three years, and that other key managers will remain in the business.