The stock for Green Mountain Coffee Roasters, Inc. leaped 42 percent Wednesday after Coca-Cola purchased a 10 percent stake in the company.
Reuters reported that Coca-Cola's $1.25 billion investment in Green Mountain
will go toward launching the coffee company's new cold drinking machine, scheduled for release possibly in October. Green Mountain shares rose to $114.85 each.
Urgent: Do You Approve Or Disapprove of President Obama's Job Performance? Vote Now in Urgent Poll
Green Mountain made its name with its Keurig coffee machines that popularized the small packets of coffee called pods to create convenient one-cup hot drinks. Green Mountain has sold 30 million single-cup machines, which are used in homes and offices around the world.
"We are really excited to start with Coca-Cola," Green Mountain's president and chief executive Brian Kelley told Reuters.
Coca-Cola Chief Executive Officer Muhtar Kent said that the deal opens up new business possibilities for the world's largest soda company.
"This gives Green Mountain a beverage partner with some hugely powerful global brands," John Sicher, editor and publisher of Beverage Digest, told Reuters. "For Coke, it gives them access to some really cool, new cutting-edge pod cold-beverage technology."
The New York Times reported that Wednesday's deal
announcement, caused SodaStream's stock, one of Green Mountain's rivals, to plummet more than eight percent in after-hours trading.
Coke's chief rival, PepsiCo Inc., denied rumors that it was planning to buy SodaStream. Citron Research published a note, according to CNN Money,
saying that PepsiCo may now have to respond to Coke's move by forming a partnership with SodaStream or buying it altogether.
"What is Pepsi going to do? Unless they believe that Coke is dead wrong, they have no choice: Hello, SodaStream!" Citron wrote.
Green Mountain, based in Waterbury, Vt., told Reuters that its income leaped 28 percent to $138.2 million, or 91 cents per share, for the fiscal first quarter, which concluded Dec. 28. The company said that its net sales rose almost percent to $1.39 billion.
Green Mountain is also moving ahead with plans to introduce a new hot drink brewing system this fall.
Editor's Note: Do You Support Obamacare? Vote in Urgent National Poll
© 2016 Newsmax. All rights reserved.