Coca-Cola Buys Sparkling Water Cult Favorite Topo Chico For $220 Million
While everyone’s currently been obsessing over LaCroix as a favorite sparkling water brand, another company, Topo Chico, is on a mainstream trajectory. The company has been bottling sparkling water in Mexico since 1895, but has gained a lot of traction in the USA recently, especially in Texas. With that rapid growth in mind, Topo Chico has just been given the ability to rival or exceed LaCroix’s popularity much faster thanks to an acquisition deal with Coca-Cola.
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The soda giant recently announced that it had acquired the sparkling water brand for what Forbes reports to be $220 million. For the two brands, the deal is sort of an alliance of old friends, as Topo Chico facilities bottled the first ever Coke sold in Mexico and Arca International, Topo’s former owner, is a massive bottling partner for Coca-Cola.
For Coca-Cola, the new brand acquisition is a chance to rebound in a struggling soda industry. As soda sales hit a 30 year low and the sparkling water category is growing in the double digits, it makes sense for Coca-Cola to pick up one of the heavy hitters in the fizzy water world. With Topo Chico flourishing as of late, buying it is a smart pickup that should help numbers improve for the massive soda business.
As for Topo Chico, they get the ability to expand their already popular brand even further while holding true to their roots. Coca-Cola has already pledged to keep the same sourcing location for the water in Monterrey, Mexico, and use the same bottling facility Topo Chico has already been utilizing, meaning that current fans won’t notice a change in their beloved sparkling water.
Topo Chico has gained a massive following amongst millennials and the craft cocktail world, especially in Texas, where 70% of its U.S. sales currently occur. The brand ships out approximately 250 million bottles to the US every year, and is currently available in 35 total states.
Coca-Cola Emerging Brands VP Matt Hughes thinks it will be a global name within the next decade, which goes to show how much confidence Coca-Cola has in their old friend and business partner.
