PepsiCo, bottling group to buy Russian juice business
March 20, 2008
by FoodBusinessNews.net Staff
MOSCOW — PepsiCo Inc. and The Pepsi Bottling Group have agreed to jointly acquire a 75.53% stake in JSC Lebedyansky, a Russian juice company, for $1.4 billion. The acquisition does not include the baby food and mineral water business.
"This agreement provides us with a strong platform for continued expansion in one of the world’s fastest growing juice markets and advances the global transformation of PepsiCo’s product portfolio," said Michael White, PepsiCo International chief executive officer and vice-chairman of PepsiCo. "Combining Lebedyansky’s strengths with those of PepsiCo, one of the world’s largest makers and sellers of branded juice, and The Pepsi Bottling Group, our largest bottler, will create vast opportunities. We are committed to investing in Lebedyansky’s brands and building and even brighter future for this great Russian company."
The acquisition will be split 75% by PepsiCo and 25% with the bottling group and is subject to regulatory approvals. Plans are to spin off the baby food and mineral water business to Lebedyansky’s existing shareholders.
Lebedyansky is the world’s sixth largest juice manufacturer with a global market share of 1.6%. It had annual net revenue of $615 million in 2006 and unaudited net revenue of $803 million in 2007.
"We are pleased to have reached this agreement with PepsiCo and PBG, outstanding companies that bring a long heritage of investing in Russia and a clear commitment to the growth and success of Lebedyansky," said Yuri Bortsov, chairman. "They will bring significant investment and distribution strength and ensure that this company remains a strong, vibrant competitor."