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BOCA RATON, Fla. & LOUISVILLE, Ky. - Celsius Holdings , Inc. (NASDAQ: NASDAQ:CELH), known for its energy drink brand CELSIUS®, announced a definitive agreement to acquire Alani Nutrition LLC for a net purchase price of $1.65 billion. The deal, involving cash and stock, will merge two prominent players in the U.S. energy drink sector, aiming to capitalize on the increasing demand for zero-sugar beverage options.
The acquisition, announced today, is expected to be completed in the second quarter of 2025, subject to regulatory approvals and customary closing conditions. Celsius anticipates the transaction will be accretive to cash EPS in the first year post-acquisition. The company’s current financial health score of "GREAT" on InvestingPro and robust current ratio of 4.7x suggest strong capability to execute this strategic move.
Alani Nu, established in 2018, has become a popular brand among Gen Z and millennial consumers, particularly women, for its functional beverages and wellness products. The brand saw a 78% year-over-year increase in retail sales, according to Circana data for the last-four-week period ended January 26, 2025.
Celsius Chairman and CEO John Fieldly expressed excitement about the acquisition, highlighting Alani Nu’s strong community and brand presence. Alani Nu’s co-founder Katy Schneider expressed confidence in Celsius as the best partner to further the brand’s growth while maintaining its core values.
The transaction details include a purchase price of $1.8 billion, with $1,275 million in cash and $500 million in newly issued restricted shares of Celsius Holdings common stock. The cash portion will be funded through a combination of debt financing and cash on hand. The stock consideration will be subject to a two-year lock-up agreement. With last twelve months revenue of $1.37 billion and a healthy gross profit margin of nearly 50%, Celsius demonstrates strong operational performance. For deeper insights into Celsius’s financial metrics and growth potential, investors can access comprehensive analysis through InvestingPro’s detailed research reports, which cover over 1,400 US stocks.
Celsius’s strategic rationale for the acquisition includes creating a leading platform at the intersection of consumer megatrends, combining two scaled brands with clear category tailwinds, and leveraging combined strengths to drive growth. The acquisition is expected to generate approximately $2 billion in sales and offer significant topline scale and growth.
UBS Investment Bank served as Celsius’s exclusive financial advisor and provided a committed financing package. Legal counsel for Celsius was provided by Freshfields US LLP, while J.P. Morgan Securities LLC and Greenberg Traurig, P.A. served as financial and legal advisors, respectively, for Alani Nu.
Celsius also released its fourth quarter and full-year 2024 results today and will host a webcast to discuss these financial results and business updates with the investment community. The company’s strong financial position is reflected in its Altman Z-Score of 9.87, indicating robust financial health. Investors seeking detailed analysis of Celsius’s performance metrics, including 16+ additional ProTips and comprehensive valuation models, can access these through InvestingPro’s premium research platform.
This news article is based on a press release statement and does not contain any opinions or recommendations from the author.
In other recent news, Celsius Holdings has been the focus of several analyst revisions and legal developments. Jefferies recently adjusted its price target for Celsius to $33, maintaining a Buy rating, citing a decline in distribution points and a slowdown in product velocity. Stifel also revised its price target to $37 while upholding a Buy rating, forecasting a decrease in sales growth in the first quarter of 2025 but a modest recovery in the second quarter. Piper Sandler cut its price target to $33, maintaining an Overweight rating, and anticipates a potential increase in shipments by 2025, despite current challenges.
TD Cowen downgraded Celsius from Buy to Hold, lowering its price target to $29 due to a deceleration in sales growth and competitive market risks. Additionally, Celsius Holdings reached a settlement in a shareholder derivative lawsuit, which includes corporate governance reforms and a payment of $987,500 for attorneys’ fees. This settlement, pending final court approval, reflects the company’s efforts to address shareholder concerns. These recent developments highlight the various challenges and adjustments Celsius Holdings is navigating in the current market environment.
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