Monster Probed by State Attorney General Over Drinks
Monster Beverage Corp. (MNST), the largest U.S. energy drink maker by volume sales, said an unspecified attorney general is investigating the company’s flagship drink and ingredients. The shares fell in late trading.
The attorney general sent a subpoena in July, the Corona, California-based company disclosed today in a regulatory filing. The investigation, which also is looking into advertising, marketing and promotions, is in an early stage.
“It is unknown what, if any, action the state attorney general may take against the Company,” Monster Beverage said in the filing, adding that it can’t assess what kind of financial or operational impact it may have.
Coca-Cola Co. (KO), the world’s largest soft-drink maker, distributes almost half of Monster Beverage’s U.S. volume. Anheuser-Busch InBev NV (ABI), the biggest brewer, distributes about the same amount, with a few small vendors making up the balance.
Monster Beverage’s shares fell 4.8 percent to $58.26 at 7:59 p.m. The stock had risen 33 percent this year through today’s close.
Judy Lin Sfetcu, a Monster Beverage spokeswoman, said the company has no comment beyond the filing.
Shum Preston, a spokesman for California Attorney General Kamala Harris, said the office doesn’t confirm or deny the existence of investigations. A representative of the New York attorney general’s office also declined to say whether it was investigating.
Second-quarter profit was 59 cents a share, the company reported yesterday, less than the 61-cent average of nine analysts’ estimates compiled by Bloomberg. Sales rose 28 percent to $592.6 million, trailing the average projection of $595.9 million.
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