PepsiCo has announced plans to buy Sodastream in a $3.2 billion (£2.5 billion) deal.
In a statement released on Monday, PepsiCo said they would buy the Israeli company for $144 a share in cash – 11 percent higher than Friday’s closing price.
The takeover has been approved by both boards, with the PepsiCo president Ramon Laguarta saying SodaStream was “highly complementary and incremental” to Pepsi’s business.
“PepsiCo is finding new ways to reach consumers beyond the bottle,” he said.
SodaStream’s stock has increased by 85 percent this year after rising by 78 percent in 2017.
Pepsico is hoping to transition into a market with healthier snacks and beverages.
Euromonitor International analyst Matthew Barry said: “With sugary carbonates and juices struggling and no turnaround in sight, mitigating the losses through newer and healthier products will be essential for PepsiCo.”
SodaStream has been the focus of controversy in the Middle East due to its previous company’s base in the West Bank.
Protesters claimed victory when the company closed the West Bank factory in 2014, which is part of Israel’s illegal occupation of the territory.
“It’s propaganda. It’s politics. It’s hate. It’s antisemitism. It’s all the bad stuff we don’t want to be part of,” said the chief executive of SodaStream, Daniel Birnbaum.
“SodaStream should have been encouraged in the West Bank if [the BDS movement] truly cared about the Palestinian people,” he added.
If the deal is approved by regulators, it is expected to be finalised by January 2019, depending on a vote by shareholders of the Israeli firm.
Shares in SodaStream (TLV: SODA) are currently trading up 8.94 percent at 52.250. Shares in PepsiCo (NASDAQ: PEP) are up 0.46 percent at 115,49 (1446GMT).