Coca-Cola buys a kombucha maker as drinkers ditch sugary soda

Business Insider US

Coca-Cola acquired the company behind MOJO kombucha.
  • Coca-Cola has acquired Australian kombucha-maker Organic & Raw Trading Co, which produces MOJO kombucha. 
  • The purchase of the company marks Coca-Cola's first ever acquisition of a kombucha brand. 
  • Coca-Cola is increasingly diversifying its portfolio and investing in brands that are seen as healthier alternatives to soda as drinkers ditch sugary beverages. 

Coca-Cola has acquired a company that makes kombucha, a fermented tea beverage that contains living bacteria.

On Tuesday, the soda giant announced it had acquired Organic & Raw Trading Co., which makes the MOJO brand of Kombucha. The purchase of the maker of MOJO, which is best-known in Australia, marks Coca-Cola's first ever acquisition of a kombucha brand. 

Coca-Cola has been increasingly diversifying its portfolio beyond soda beverages in recent years. 

In August, the company announced it is taking a minority stake in sports-drink brand BODYARMOR. Other investments include Topo Chico, a sparkling-water brand, and Zico, a coconut-water brand.

The investments come at a time when people are increasingly moving away from sugary sodas. 

Coke and Pepsi brands declined 2% and 4.5%, respectively, by volume in the US in 2017, according to Beverage Digest. Meanwhile, other beverages that are seen as healthier or that present certain health benefits, such as bottled water, are experiencing significant growth. 

While kombucha is still on the cusp of mainstream growth, sales have exploded in recent years. In the US, retail sales of refrigerated kombucha and other fermented beverages grew a whopping 37.4% to $556 million in 2017, according to a conference of kombucha brewers (called KombuchaKon) organized earlier this year. 

Kombucha fans have been drawn to the beverage in part because it is rich in antioxidants and probiotics, living bacteria with positive health benefits. However, the drink isn't without its skeptics, who point to the fact that some of the benefits have been over-hyped and that certain brands contain a surprising amount of sugar and small amounts of alcohol. 

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