Shares of energy drink maker Monster Beverage Corp. tumbled after the company said its partner Coca-Cola Co. is developing energy drinks of its own.
Coke bought a stake in California-based Monster in 2014. At that time, Coke transferred its energy brands to Monster and agreed not to develop competing drinks.
But in a conference call with investors late Wednesday, Monster CEO Rodney Sacks said Coke is developing two energy drinks it believes are exceptions to the agreement.
Coke says Coca-Cola Energy and Coca-Cola Energy No Sugar wouldn't violate the agreement, which allows Coke to market energy drinks under its own name. But Monster is fighting their release.
Both companies confirmed they have entered into arbitration.
Monster shares were down 8 percent to $51.20 in morning trading.