PepsiCo (NASDAQ:PEP) invested US$550mln into energy drink maker Celsius Holdings (NASDAQ:CELH) as part of a long-term distribution deal.
The owner of the eponymous soft drink, Doritos and Tropicana now owns a roughly 8.5% stake in the company and is set to appoint a director to its board, according to CNBC.
Celsius, which was founded in 2005, reported strong sales growth during the pandemic for its energy drinks. And revenue in the first quarter soared 217% in the US to US$123.5mln.
The group brands its drinks as health and targets young consumers who are active and exercise.
The deal strengthens Pepsi's ties to energy drinks, which is one of the fastest growing beverage segments outside of alcohol, according to CNBC.