Dr Pepper Snapple Group Inc. announced Tuesday a deal to buy premium antioxidant infused beverage company Bai Brands for $1.7 billion in cash. The beverage company said the purchase price includes a $400 million tax benefit. The company expects the acquisition to add 132 million to 2017 sales expectations, reduce 2017 earnings by 3 cents a share then added to earnings in 2018. "Bai has contributed greatly to our allied brand lineup since we began distributing it broadly in 2013," said Chief Executive Larry Young. "Adding it to the broad range of choices and options in our company-owned portfolio is a natural next step." Dr Pepper's stock, which was still inactive in premarket trade, has declined 8.5% year to date while the S&P 500 has gained 7.6%.
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