Coca-Cola rumored to buy Monster

The beverage giant may be on the verge of its largest acquisition ever.

By Kim Peterson Apr 26, 2012 6:37PM
By Paul Quintaro, Benzinga Staff Writer

According to several analysts Benzinga spoke to Thursday, Coca-Cola (KO) could have its sights set on Monster Beverage (MNST) in an acquisition that may be the beverage giant's largest ever.

Jack Russo of Raymond James thinks Coke might be planning to buy the energy-drink maker. If that's the case, he said, investors should look for Coke to begin selling off some bottling assets to raise money. Still, he noted that if Coke were to consider such a move, it may draw fire from shareholders since the purchase price would amount to a "king's ransom."

Shares of Monster Beverage rose nearly 3% Thursday to close at $65.38, giving it a market value of $11.5 billion. Assuming some premium, the purchase would be the largest in Coca-Cola's history. Given the size of the deal, investors may be skeptical of the possibility.

Which stock is a better buy, Coke or Pepsi? Hear one analyst's take in the following video.

Post continues below.
Still, energy drinks remain one the fastest-growing sectors of the beverage market, and Coke's attempt to enter the market with its own Full Throttle has proven to be a failure.

Benzinga spoke to another analyst on the possibility, but he declined to comment on the record as he was not authorized to speak on the matter.

"Yes, the price Coke would have to pay for Monster would be the biggest hangup," he stated. "Still, Coke wants to be a bigger presence in the energy drink market and they already have a fairly close distribution relationship with Monster. The move would be elevating that to the next level. They could do it, but they would really have to be excited about Monster's growth prospects."

Shares of Coca-Cola closed Thursday up 1.04% to $75.71.

More from Benzinga

VIDEO ON MSN MONEY

50Comments
Apr 26, 2012 7:09PM
Apr 26, 2012 8:13PM
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If Coke takes over, those phuckers better not start using high fructose corn syrup.
Apr 26, 2012 8:00PM
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This stuff is poison. A quick fix, but leaving a void beyond that short burst of so-called "energy."

 

So.....just what's a body to do when it is tired, worn out, and sleepy? After all, your body is trying to tell you something; something you need very badly.

 

Answer: Pull over and sleep, dammit.

Apr 26, 2012 8:08PM
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Full Throttle was a joke.  Monster is a better fit, Rockstar would be the better product.  How about Coca Cola just go back to the old recipe and put some cocaine back in Coke!

 

Apr 26, 2012 9:21PM
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Coke needs to stay away from Monster. They will just ruin it. Quality will be lost because they're gonna try to save every penny.
Apr 26, 2012 8:45PM
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I Love monster, and I hope they don't sell out, because operating on their own, they have made a great product, and I'm afraid standards will drop if they're bought out.
Apr 26, 2012 8:30PM
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 I really hope they dont go this route as MONSTER is a great product and Coca Cola will ruin it by messing with everything from the marketing to the recipe. BAD news for any of us that actually enjoy the product................
Apr 26, 2012 9:24PM
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Duck502, might I suggest you have a drink of my nut juice?  It's delicious and high in protein! 
Apr 26, 2012 11:53PM
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I so hate this idea! Anyone who thinks Monster will remain Monster after a Coke acquisition is well CRAZY!! I LOVE MONSTER and the REHABS are the best formulas yet, that why Monster is experiencing such growth!!! I sure hope this doesnt happen . . .

 

DONT, DONT, PLEASE DONT!!!

Apr 26, 2012 9:06PM
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This is terrible news for Monster (former HANS) shareholders.  HANS/MNST has gone up well over 1000% over the past decade (with splits), and I have benefitted well.  Hell, it's the closest thing I have to a retirement account!  Coke?  That's a dog that doesn't know the meaning of socially responsible investing.  As far as Monster consumption -- never drank the energy drink, but I'm a constant drinker of Hansen's mandarin-lime, world's best soft drink.
Apr 26, 2012 11:20PM
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Tongue outmonster is monster,just don't **** with it COKE ,
Apr 27, 2012 3:50AM
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I'm going to make my own energy drink. it will be called "Flatline"

One can will stop your heart if you stand up too quick. The most powerful yet. Any buyers? Coke? Anybody?
Apr 26, 2012 9:02PM
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This is not new news.  Swire Coca Cola has been distributing Monster for the past 8 years.  It has been very successful for them as it's getting harder and harder to make money off of soft drinks alone.  Soda has been a loss leader and takes a whole lot of volume to make any money.  We used to ship out pallets of Monster to Costco stores on a weekly basis.  Sure it takes more room in a warehouse but if it makes the company money its all worth it.
Apr 26, 2012 7:50PM
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Aww.. Coke will ruined it just like Pepsi ruined vernors
Apr 27, 2012 12:54AM
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This is a typical stock market ploy to help increase stock price for Monster. This type of stock market scam/hustle concerning a buy out like this takes place on paper; and on paper it will actually turn out (appear) in the end on paper that Monster buys Coke; raising Coke stock price in the end. Mean while those who purchased Monster stock end up losing when the stock drops after the buy out. Never trust what you hear; a large number of writers and so called experts get their pockets lined on a standard basis for helping miss direct potential stock buyers. The stock market is just a paper casino and there is no bail out for stock holders when things go bad. A safe bet for those who must by stock in the hope of making bank on this merger is to buy both Coke and Monster stock, that way the odds are in your favor and at worse you will break even. Remember there is no real deal at the moment and this deal maybe just a basic ploy/rumor to help raise monster stock price.

 

Want to know a little secret, Pepsi Co. through all its subsidiary holdings has controling stock in Coke. Sad, but known to insiders as very true. So in the end Monster will be owned by Pesi Co. :(

 

Christian Wylder

Apr 27, 2012 1:55AM
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If Coke aquires monster they'll probably mod it into a "New Monster" and take all the fizz out of it and botch up the flavour  ala new coke.
Apr 26, 2012 10:00PM
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maybe coke should buy Dick's nut juice.
Apr 26, 2012 7:53PM
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Time to push some more poison down any kids throat that has the cash

( old enogh or not ) A buck is a buck to big BIZZ. and they dont have time to give a shite . 

Apr 27, 2012 3:05AM
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Everyone should just stop drinking this crap , and put these purveyors of poor health out of business !
Apr 27, 2012 12:16AM
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i hate the idea. there just goin to change something that doesnt need to be changed
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