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Monster’s Drinks Seen Fueling Highest Valuation: Real M&A

Monster Beverage Corp.’s escalating profit from energy drinks pumped full of caffeine and nitrous oxide may tempt acquirers to chase what would be the most expensive takeover in the industry’s history.

After the stock more than doubled in the last year, Monster Beverage was valued last week at 20 times earnings before interest, taxes, depreciation and amortization, the priciest of any North American soft-drink maker greater than $500 million, according to data compiled by Bloomberg that includes net debt. The $10.4 billion company, which got its start selling juices in the 1930s, has the highest operating margins in the industry and is projected to boost earnings 70 percent in the next three years, analysts’ estimates compiled by Bloomberg show.