The deal, under which the soda giant bought 5% in Celsius’ preferred stock, brings PepsiCo’s stake in the company to about 11% after conversion. PepsiCo had paid $550 million for an 8.5% stake in Celsius in 2022.

Shares of Celsius, which have more than doubled in value this year, surged 11% in premarket trading on the news.

As part of the agreement, Celsius’ health and wellness drinks brand, Alani Nu, will move into PepsiCo’s distribution system in the United States and Canada.

The increase in stake comes as PepsiCo seeks to capitalise on Alani Nu’s rapid growth and broad appeal among fitness-focused female consumers.

–Reuters–