In a recent turn of events, Monster Beverage Corp. has been granted approval by a bankruptcy court to acquire its one-time competitor, Bang Energy, for a whopping $362 million.
Thanks to Judge Peter Russin’s approval on July 3, not only does this deal resolve ongoing disputes between the two beverage giants, but it also prevents the potential closure of Bang Energy.
The company had been on shaky ground ever since its board ousted its founder, Jack Owoc, earlier this year. Even many of their loyal fans are beginning to ask, ‘Is Bang going out of business?’
Monster Eventually Acquired Bang Energy
Bang Energy, introduced to the market in 2012 by founder Jack Owoc, quickly became known for its eye-catching cans and distinctive flavors.
By 2020, it was making waves, with a reported $300 million in sales and a top spot as the number one food and beverage “pacesetter” by IRI Worldwide.
However, things took a turn. Despite reaching its sales peak in 2021, by the third quarter of 2022, sales had plummeted by 27%.
Facing legal challenges amongst others, Bang and its parent company, Vital Pharmaceuticals, filed for bankruptcy in October 2022. They said the decision is to help the company recover from its recent challenges.
There’s Has Been a Long-Time Issue between the Two Companies
The relationship between Monster and Bang Energy has been fraught with tension for quite some time. Bang Energy, which surged in popularity due to its creative partnerships on TikTok, has previously squared off against Monster in the courtroom.
Monster filed a lawsuit against Bang, claiming false advertising and other misconducts. The bone of contention? Bang’s claim of including the protein building block, creatine, in its drinks. Monster contended that this could lead them to lose customers to false claims. The court sided with Monster, awarding them a substantial $293 million.
However, the issue didn’t end there. Despite the court ruling, Bang continued to use “Super Creatine” in its advertising. This led Monster to return to court in April, seeking a directive that would compel Bang to halt such claims.
Bang defended its stance, asserting that it would face significant losses if it had to recall and destroy existing cans bearing the “Super Creatine” tagline. Yet again, Monster emerged victorious.
In the recent decision approving Monster’s acquisition of Bang, the judge also sanctioned a resolution to end the ongoing false advertising disputes against Vital Pharmaceuticals, Bang’s parent company.
The Future of Bang Energy after the Acquisition
The future of Bang Energy is presently filled with so many uncertainties, particularly after declaring bankruptcy.
Presently, the company is in talks about a significant transition, with Monster Beverage Corporation poised to take ownership after a judge’s approval. The stakes are high: without this acquisition, a staggering 700 employees stood to lose their livelihoods.
However, there’s a silver lining. Bang Energy had previously hinted at the dire possibility of liquidation. Yet, with the judge’s nod for the acquisition, it’s believed that around 300 of those jobs might be salvaged. As we head further into 2023, exact details remain sparse, but the acquisition is slated to finalize later in the year.
What Does the Acquisition Mean for Bang Energy Fans?
The acquisition of Bang Energy by Monster Beverage brought a mix of emotions among its dedicated fanbase. On the bright side, many Bang Energy enthusiasts are breathing a sigh of relief. The merger could bolster the brand, potentially restoring the prestige it once held as the third top-selling drink in the US in 2020.
Yet, there’s a flip side to this coin. Given that Monster Beverage was once a rival, changes to the beloved brand are anticipated, causing unease among fans. There’s a lingering apprehension about the potential alterations Monster might introduce.
Apart from that, the possibility of hundreds of Bang Energy employees facing job losses not only concerns those directly affected but also resonates deeply with the brand’s loyal followers.