Keurig Dr Pepper Inc. and Nutrabolt have inked a strategic partnership agreement that includes a long-term sales and distribution arrangement along with a significant equity investment that is expected to close by year-end. 

KDP’s cash investment of $863 million in the company behind the popular C4 Energy drink brand provides an ownership stake of approximately 30% along with board representation.

Alongside one of the fastest-growing performance energy drink brands in the U.S., Nutrabolt’s portfolio includes C4 Pre-Workout and XTEND, a post-workout recovery brand. Nutrabolt’s estimated 2023 net sales are expected to exceed $650 million, according to the company.

Sales and Distribution

Under the long-term sales and distribution agreement, KDP will sell and distribute C4 Energy in the majority of KDP’s company-owned direct store distribution territories. Nutrabolt will continue to distribute C4 Energy directly or through its existing distribution network to the specialty, health club, and fitness channels and will continue to work with some of its existing beverage distributors in certain markets.

KDP is now the largest investor in Nutrabolt behind its Founder, Chairman and CEO Doss Cunningham. KDP also has the opportunity to earn additional equity tied to in-market execution. In addition, the partnership provides KDP with rights to further increase its ownership stake under various capital raising scenarios.

Supercharged Brand Growth

Cunningham said the strategic partnership will “supercharge C4 Energy’s current growth trajectory by accelerating household penetration, enhancing distribution, and strengthening our overall commercial capabilities. We will also be partnering with a talented and ambitious leadership team who shares our values, our competitive spirit, and has a similar philosophy of disciplined growth and maximizing overall value creation.”

The deal represents a “win-win transaction” between the companies, said KDP Chairman and CEO Bob Gamgort. “KDP gains significant presence in the rapidly growing performance energy drink market and Nutrabolt gains access to a strategic investor with extensive sales and distribution capabilities to further accelerate its growth. We believe that bringing together the resources, talent and expertise of both companies will accelerate innovation and growth and drive significant value creation over time.”

“Over the past 20 years, Nutrabolt has grown from a bootstrap startup to become one of the fastest growing global active health and wellness companies in the world,” Cunningham added. “This is an amazing moment for our company, and it is because of the incredible contributions of our team members, commercial partners and those who have financially backed us over the years, namely MidOcean Partners, and CPG veterans and equity investors Brian Goldberg and Clayton Christopher.”

The transition of C4 Energy distribution to KDP will occur during 2023, which is expected to be a transition and investment year, with limited impact on KDP financial results until 2024, when KDP expects the strategic partnership to become accretive to its financial results.