Investing.com -- Celsius Holdings (NASDAQ:CELH) saw its shares rocket more than 30% in premarket trading Friday after the energy drink maker announced it is set to acquire rival Alani Nu and reported better-than-expected fourth-quarter results.

Celsius will buy Alani Nu, a fast-growing energy drink brand, in a $1.8 billion deal consisting of cash and stock. The acquisition, which includes a net purchase price of $1.65 billion along with $150 million in tax assets, marks Celsius’s largest transaction since its founding nearly 20 years ago.

“Celsius is at a defining moment in the better-for-you, functional lifestyle products movement, and we are thrilled to welcome Alani Nu to the Celsius family," said John Fieldly, Chairman and CEO of Celsius.

The move strengthens Celsius’s position in the competitive energy drink market, particularly as its own growth has started to slow. Both Celsius and Alani Nu have marketed their products as fitness-focused beverages and gained popularity among younger consumers, especially women. The acquisition also provides Alani Nu with greater marketing resources as Celsius looks to expand its portfolio.

The deal comes as major beverage companies, including Keurig Dr Pepper (NASDAQ:KDP) and Molson Coors (NYSE:TAP), ramp up their investments in energy drinks. Meanwhile, Coca-Cola (NYSE:KO) maintains its presence in the space through its stake in Monster Beverage (NASDAQ:MNST), and PepsiCo (NASDAQ:PEP), which took a $550 million stake in Celsius in 2022, remains a key distribution partner.

While energy drink sales have been on the rise, Celsius's growth has slowed over the past year, according to NielsenIQ data compiled by Jefferies. In contrast, Alani Nu has been among the fastest-growing brands in the category.

Founded in 2018 by fitness influencer Katy Hearn, the Louisville-based company has expanded its market share through a strong presence on social media and collaborations with high-profile influencers like Kim Kardashian, Paris Hilton, and Addison Rae. Alani Nu offers a range of products, including energy drinks, supplements, and protein beverages.

"The Alani Nu brand has momentum," Jefferies analysts commented.

"The brand is growing nicely and has been the biggest share gainer over the past year, bringing Celsius' share to ~15%. Notably, Alani Nu should help Celsius grow given the slowdown of its core business," they noted.

The reports of a deal came on the same day Celsius reported its fourth-quarter earnings, which topped expectations.

The company posted earnings per share (EPS) of $0.14, ahead of analysts’ forecast of $0.10. Revenue, however, missed estimates, coming in at $332.2 million, also above the $327 billion expected by analysts. 

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