Vital Pharmaceuticals, the parent company of Bang, filed for bankruptcy very recently, which might make you wonder if Bang is going out of business.
Leaving behind brands like Monster and Redbull, Bang became the highest energy drink seller in the USA.
So what led the company to take such drastic steps within just a few years of soaring to new heights? Keep reading to find out!
The Rise & Fall of Bang Energy
Jack Owoc envisioned creating an energy drink that would revolutionize the energy drink market.
And through a combination of marketing, flavors, sleek packaging, and whatnot, his idea came true.
Although Bang Energy drinks have been in the market since 2012, it was not until 2019 that the brand first saw its revenue hitting the ceiling by making $1.3 billion in revenue.
During this time, Bang Energy also became the third highest-selling drink.
With increasing popularity, the brand also started garnering controversies and soon found itself in legal battles, which all led to its destruction.
Monster Energy Files Lawsuit Against Bang
Bang advertised its drinks claiming that they contain Super Creatine and claimed that their creatine is “20 times more effective at reaching the brain than other types of creatine,” that it could help in the treatment of Parkinson’s and Alzheimer’s disease, and that it can reverse “mental retardation,” as well.
However, Creatine in Bang’s drinks was neither proper nor FDA-approved.
As a result, Monster Energy won the case and sued Bang for $293 Million for false advertisement.
What’s The Deal Between Bang & PepsiCo?
In the year 2020, Vital Pharmaceuticals and PepsiCo entered into a distribution agreement that allowed PepsiCo to distribute Bang Energy drinks in the United States.
However, in November 2020, Vital Pharmaceuticals sent a termination agreement to PepsiCo for reasons that are unknown. But, PepsiCo still remained the exclusive distributor of Bang till 2023 as a result of the emergency arbitrator rule.
As a result, Bang sued PepsiCo for miscommunication and foul play. In turn, PepsiCo also threatened retailers to take Bang drinks only from PepsiCo.
According to the former chief executive officer of Bang Energy, Jack Owoc, PepsiCo, and Bang have settled their fight, and now there is no dispute between the two.
Why Did Bang Energy File For Bankruptcy In 2022?
Several companies, including PepsiCo, Monster Energy, etc., have sued Vital Pharmaceuticals, the parent company of Bang, for different reasons.
Bang owed PepsiCo $115 Million, Monster Energy $293 Million, and $175 million to Orange Bang.
Then, in October 2021, even Sony Music filed a lawsuit against Bang for using their music without taking a license from them.
To overcome this lawsuit, the company had to pay a huge amount of money, which led them to a massive debt. As a result, Bang and Vital Pharmaceuticals filed for bankruptcy in October to overcome these financial challenges.
Monster To Acquire Bang Energy For $362 Million
Very recently, Monster Energy agreed to acquire Bang Energy for a whopping $362 Million.
They even won the bankruptcy court’s approval to acquire their rival Bang Energy out of Chapter 11 for $362 million, as well as settle litigation between the two companies.
Both Bang and Monster are very popular and one of the best-selling drinks in the United States. However, Monster’s court win against Bang for false advertisement changed the whole scenario for Monster.
If Bang Energy agrees to the acquisition, then it will give Monster a crucial boost in the energy drink sector.
Is Bang Going Out Of Business?
Bang’s huge debt has led its parent company to file for bankruptcy, which is a serious concern.
However, Monster Energy has agreed to acquire Bang, and if Bang lets its rival take over, then it can be saved. Otherwise, it is most likely that Bang will go out of business and might shut down soon.
Can Bang Energy Be Saved?
Currently, the future of Bang Energy is uncertain.
Although the judge has shown a green flag and asked Bang to be acquired by Monster Energy, the decision for Bang is a tough one.
However, it seems like the only way right now in which Bang can be saved. If Bang agrees to the acquisition, they will not only be saving their popular drink but also the jobs of 700 people.
Now, it is up to the representatives of Bang Energy to decide whether they would give in to their rivals, sadly, or if they will liquidate the company altogether.
Bang hit the U.S. market in 2012, but it was only in 2019 that it started soaring to new heights and started seeing its revenue hitting the ceiling thanks to the marketing efforts of its CEO.
However, with popularity comes attention, and in Bang Energy’s case, the attention is what led the company to ruin.
Is Bang going out of business? This only time will tell.
Who owns Monster Energy?
Monster Energy was created by Hansen Natural company, which is called Monster Beverage Corporation now and is owned by the same.
What is going on with Bang Energy?
Bang Energy is in huge debt because of losing various legal battles. As a result, its parent company had to file for bankruptcy in October 2022, and now the company’s management is deciding whether they will discontinue Bang or agree to an acquisition by Monster Energy.