The auction scheduled for the sale of VX Pharmaceuticals (VPX), the owner of Bang Energy, has been called off as Monster Beverage Corp., a US-based peer, is now poised to finalize the acquisition of the Florida-based company.
Based on a leaked court document on Thursday, June 29th, it has been revealed that Blast Asset Acquisition, a subsidiary of Monster Beverage Corp., emerged as the sole successful bidder for VPX’s assets. The assets, originally scheduled for auction on June 30th, were secured by Blast Asset Acquisition according to the document.
According to a document submitted to the US Bankruptcy Court for the Southern District of Florida, it was revealed that both parties had entered into an “asset purchase agreement” that assessed the total value of “all or substantially all” of the assets at $362 million. This valuation encompasses a $25 million deposit along with the assumption of assumed liabilities.
Bloomberg has reported that there is a possibility of the deal being hindered by a review from the US Federal Trade Commission. The review process could potentially jeopardize VPX’s future as it faces financial instability, putting the company at risk of liquidation, as stated by the publication.
The anticipated acquisition of VPX’s Bang Energy by its rival, Monster, would mark the end of a protracted and acrimonious legal dispute between the two companies. VPX had filed for bankruptcy in October following a $293 million false advertising lawsuit defeat against Monster, with the latter being VPX’s largest unsecured creditor. The resolution of this legal battle would be brought about by the sale of VPX’s assets to Monster.
In April, Monster emerged victorious once again in its legal battle against VPX when it secured a permanent injunction. This injunction effectively prohibited Bang Energy from advertising its beverages as containing “Super Creatine.” The court’s ruling favored Monster, reinforcing its position and limiting the marketing claims made by VPX regarding their drinks.
In November, the Vital Pharmaceuticals brand, VPX, made a temporary agreement to remove all references to “Super Creatine.” As a result, the message on the Bang Energy cans was replaced with the phrase “Fuel your destiny.” This adjustment was made in response to the ongoing legal disputes and aimed to comply with the terms set forth during that period.
The challenges faced by Bang Energy trace back to the contentious split between the company and its distributor, PepsiCo, in 2020. Following the separation, the outspoken CEO of Bang Energy, Jack Owoc, openly accused the owner of the Gatorade brand of deliberately orchestrating a plan to undermine and dismantle the energy drink company. Owoc claimed that PepsiCo engaged in premeditated actions aimed at destroying Bang Energy.
According to Owoc, Bang Energy’s underperformance during its distribution by PepsiCo was attributed to the lack of commitment from the carbonated soft drink (CSD) giant towards the brand. He believed that the owner of the Rockstar brand refrained from acquiring a stake in Bang Energy due to its ulterior motive of ultimately wanting to dismantle the energy drink company. Owoc expressed his belief that PepsiCo’s reluctance to support and invest in Bang Energy stemmed from their intention to destroy the brand.
Owoc was himself later ousted as CEO of the company, and forced to delete comments made on social media posts by the Bang Energy brand.
