March 1 (Reuters) - Diet-soda maker Zevia is open to selling a stake but will not consider an outright sale of the company, despite getting numerous buyout offers from beverage companies and private equity firms, its chief executive said.
Zevia’s stevia-sweetened colas and fruit-flavored drinks with zero calories are enjoying a surge in sales as consumers cut down on sugary sodas and turn to healthier options.
“We are in a world where growth in conventional consumer packaged goods has slowed dramatically and everyone is looking for the next growth engine,” Chief Executive Paddy Spence told Reuters. “That fuels a lot of (buyout) enquiries.”
The company could also pursue a public offering of its shares, he said.
Soda makers PepsiCo and Coca-Cola Co are cutting sugar in their drinks while investing in low-calorie and non-soda beverages to tackle falling soda sales and the threat of taxes on sugar-sweetened drinks.
The two companies have snapped up several non-soda drink makers over the last few years and are on the prowl for more.
Coke launched its own stevia-sweetened drink, Coca-Cola Life, in 2014, with Pepsi following with Pepsi True the same year.
Zevia holds 90 percent of the natural zero-calorie soda market in the United States, according to data from a joint study by research firms SPINS and IRI last year.
Other companies that also make stevia-based drinks include Bai Brands LLC, which was snapped up by Dr Pepper Snapple Group Inc for $1.7 billion last year.
Zevia’s revenue surpassed $100 million in 2015 and is “rapidly approaching” $200 million, Spence said.
Spence, a Harvard Business School graduate, bought Zevia along with Northwood Ventures in 2010 from founders Derek and Jessica Newman and Ian Eisenberg for an undisclosed amount.
Zevia’s drinks are available at retailers such as Target Corp, Safeway, Whole Foods and on Amazon.com Inc . The Los Angeles-based company is looking to expand its distribution by selling at hospitals and convenience stores.
The company is also in talks to sell its drinks at restaurants looking to add healthier menu options.
“Many of them have made huge thrusts on the food side and yet with beverages, they have not so much. That’s a fantastic target for us and I think you are going to see Zevia in national restaurant chains in the next couple of years,” Spence said. (Reporting by Sruthi Ramakrishnan in Bengaluru; Editing by Sayantani Ghosh and Anil D‘Silva)