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Sodastream International Ltd (SODA) Buyout Doesn’t Make Sense

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Sodastream International Ltd (NASDAQ:SODA)Shares of Sodastream International Ltd (NASDAQ:SODA) opened higher this morning after an overnight report in Israeli’s Calcalist daily business newspaper indicated that PepsiCo, Inc. (NYSE:PEP) might be trying to acquire the company behind the fast-growing carbonated beverage maker.

Really? That doesn’t make sense.

Sources were telling the paper that the world’s second-largest soda company was working on a $2 billion deal that would cash out SodaStream investors to the tune of roughly $95 a share. Given the explicit details of the story — down to naming Goldman Sachs as the investment banker presenting the offer on PepsiCo, Inc. (NYSE:PEP)’s behalf and Sodastream International Ltd (NASDAQ:SODA) checking with The Coca-Cola Company (NYSE:KO) to gauge interest before moving ahead on negotiations with PepsiCo — it was just a matter of time before any of the named parties would squash the chatter.

PepsiCo, Inc. (NYSE:PEP) did, denying that an offer was ever made. However, the story seemed ridiculous even before the denial.

Sodastream International Ltd (NASDAQ:SODA) is definitely an interesting disruptor. A product that many originally dismissed as a fad has succeeded in dozens of countries all over the world. Revenue soared 34% in its latest quarter. At a time when Coca-Cola and PepsiCo are barely keeping up with inflation, SodaStream is taking off — especially on the home turf of Coke and Pepsi.

Stateside unit sales of soda makers, gas refills, and syrups rose 78%, 101%, and 119%, respectively, during the quarter. Even in the seemingly reeling Europe, Sodastream International Ltd (NASDAQ:SODA)’s cranking out double-digit growth in its more mature market.

Given this kind of disruptive growth — and forward valuations that are surprisingly comparable to those of The Coca-Cola Company (NYSE:KO) and PepsiCo — it wouldn’t be a surprise if someone snapped up SodaStream. However, it’s just hard to fathom that buyer ever being Coca-Cola or PepsiCo.

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