Just before noon, trading of SodaStream International Ltd. (SODA) was briefly halted on talks of a buyout. Once reopened, shares jumped a modest 9.8% to $33.01 apiece, up from a stagnant two weeks of hovering around $29.50. Since then, prices have peaked at $35.09 but are slowly declining back down to the $32 mark. If reached, the deal would reportedly increase SodaStream’s worth to around $828 million or $40 per share.
The company is reported to be in talks with “several investment firms” interested in purchasing the company and turning it private. If this is untrue, it wouldn’t be the first time a SodaStream buyout rumor has bubbled and then fizzled out. In April, Israeli business publications shared rumors of a potential acquisition by a number of beverage industry conglomerates. PepsiCo (PEP) , Dr. Pepper Snapple Group (DPS) and Starbucks (SBUX) were all reported to be interested in purchasing SodaStream, and may again be behind the current acquisition talks.
PepsiCo is currently considered the most likely contender following a recent partnership in February between competitorCoca-Cola (KO) and Keurig Green Mountain Inc. (GMCR) . The coffee pod manufacturer is currently developing a product similar to the SodaStream and presents the latest competition in the home soda industry.
SodaStream is still down 34.52% from a year-to-date high of $49.64. It has had a particularly volatile history, with two strong surges in 2011 and 2013 met with equally strong drops. Both stock pops involved rumors of an acquisition, and each time ended in a drop when interested purchasers backed out of a deal. Adding another layer of hesitation to a buyout, SodaStream’s headquarters is located near Israel’s main airport that was recently targeted by rocket fire from Gaza.
Despite a potential 38% premium on its current share price in the event of a buyout, SodaStream’s best hopes of $40 per share are still 47% below its all-time high of $75.68 in July 2011.
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