Keurig Green Mountain announced plans Monday to buy Dr Pepper Snapple, in a deal that creates a new beverage giant that will combine Dr Pepper, 7UP, and Keurig’s single-serve coffee maker.

The company is still vastly outsized by PepsiCo and Coca-Cola, which had sales in 2016 of $63 billion and $41 billion, respectively.

Keurig Green Mountain, which is a privately held company, said Monday that Dr Pepper Snapple shareholders will receive $103.75 per share in a special cash dividend and keep 13 percent of the combined company.

Shares of Dr Pepper Snapple were up 25 percent in early morning trading.

Keurig CEO Bob Gamgort will lead the new company, called Keurig Dr Pepper. Larry Young, CEO at Dr Pepper Snapple will become a director.

Keurig and Dr Pepper Snapple will continue to run out of their current locations. Keurig is based in Waterbury, Vermont, and Dr Pepper Snapple has headquarters in Plano, Texas.

Keurig was acquired by Europe’s JAB Holding company in 2016 in partnership with the snackmaker, Mondelez International.

JAB will be the controlling shareholder, and Mondelez will hold a stake of about 13 percent to 14 percent.

The deal is expected to close in the second quarter, with the company estimating total debt to be about $16.6 billion at that time.

The acquisition must still be approved by shareholders of Dr Pepper Snapple.

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