The Vita Coco Company officially became a publicly traded company today when it was listed on the NASDAQ Global Select Market exchange under the letters COCO.
Having emerged from battles with Coca-Cola and Pepsi to become the category’s leading brand, the New York-based coconut water maker has been vocal in its ambition to transcend its core product line and evolve into a better-for-you hydration beverage platform, whether through M&A activity or internally developed innovations such as Ever&Ever and its new protein-infused water PWR LIFT.
After months of speculation regarding the size of the IPO, the total offering is 11.5 million shares, representing 2.5 million company shares and the remaining 9 million from current shareholders. The company began selling at $15 per share with a valuation of about $853 million, below the $18 to $21 range projected by analysts last week. According to MarketWatch, the company’s shares raised a total of $37.5 million, while the selling shareholders generated $135 million, for total proceeds of $172 million.
In an updated filing last week, the company confirmed that a division of KDP has reached an agreement to purchase $20 million worth of stock for $19.50 per share from Verlinvest. The capital investment firm will see its ownership stake in The Vita Coco Company reduced to 38%.
Speaking to BevNET this afternoon, Vita Coco co-founder and CEO Mike Kirban called the listing an “amazing experience.”
“Having a company like ours being publicly traded, I think it’s a great thing for us but also for our consumers and investors who are looking to invest in the future of beverages,” he said. “That’s what it’s all about.”
Speaking about potential M&A activity, Kirban noted that with Coca-Cola and PepsiCo focused on carbonated drinks, Vita Coco is positioned to provide the scale, financial resources and profitable margins to help natural beverage brands succeed.
The IPO arrives as Vita Coco is enjoying strong performance across all channels, and has seen its share of the category rise to 46%, while accounting for 89% of total growth in coconut water this year. Yet convenience stores and food service accounts are the two biggest white spaces that are being targeted for expansion as the company continues to develop new channel-specific innovations. The recent expiration of Coca-Cola and Pepsi’s shared 10-year period of exclusivity in food service, Kirban noted, mean places like airports, corporate offices and college campuses are wide open.
“This is a business of momentum, and when you’re gaining velocity and when you’re bringing more dollars per point of distribution to retailers…they’re going to give you more space,” Kirban said, noting that Vita Coco velocities at grocery have in some places outpaced rivals with much larger distribution. “That’s the real opportunity — to keep the momentum we have and leverage our partnerships with KDP and some others and really drive further growth and distribution.”