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

They would have too much to lose. Home-brewed soda is still a tiny sliver of the consumption market. Buying SodaStream would validate the trend at the expense of sabotaging their lucrative soft drink businesses. We’ll never see Coke or Pepsi sold as Sodastream International Ltd (NASDAQ:SODA) syrups. It would cannibalize canned and bottled sales. It would infuriate bottlers.

PepsiCo, Inc. (NYSE:PEP) and The Coca-Cola Company (NYSE:KO) can’t afford to ignore SodaStream. It’s growing at a time when they’re not. It just teamed up with Samsung to introduce a refrigerator that dispenses carbonated water. Life is going to gradually get harder for PepsiCo and Coca-Cola, and that’s before we address general soda consumption trends and reports attacking the unhealthy attributes of sugary soft drinks.

However, short of buying it up only so it could close it down, PepsiCo doesn’t make sense as a buyer.

SodaStream is a great stock. I own it. I’ve successfully recommended it in Motley Fool newsletters. A buyout at a healthy premium would be welcome news. However, if it happens, it just isn’t going to be PepsiCo, and this certainly isn’t going to become a bidding war between The Coca-Cola Company (NYSE:KO) and PepsiCo, Inc. (NYSE:PEP).

The article SodaStream Buyout Doesn’t Make Sense originally appeared on Fool.com.

Longtime Fool contributor Rick Munarriz owns shares of SodaStream. The Motley Fool recommends Coca-Cola, PepsiCo, and SodaStream. The Motley Fool owns shares of PepsiCo, Inc. (NYSE:PEP) and Sodastream International Ltd (NASDAQ:SODA).

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