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PepsiCo Completes Merger With Pepsi Bottling Group, PepsiAmericas - Update

PepsiCo, Inc. (PEP), Friday confirmed the completion of mergers with its two largest bottlers, The Pepsi Bottling Group, Inc. (PBG) and PepsiAmericas, Inc. (PAS), as per its expectations. PepsiCo said it would formally announce details regarding the merged companies on Monday, March 1.

The beverages company has also been granted the early termination of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, by the Federal Trade Commission for the acquisitions.

On February 17, PepsiCo announced that its bottlers received approval from their shareholders along with adoption of their respective merger agreements. Under the agreement, the bottlers were to be merged with PepsiCo's wholly-owned subsidiary Pepsi-Cola Metropolitan Bottling Company, Inc.

A decade ago, PepsiCo sold off the bottlers with a view to streamline its business. Recently, the company revised its earlier strategy and planned for a vertical integration.

Last August, PepsiCo reached definitive agreements with Pepsi Bottling and PepsiAmericas to acquire the remaining shares in its bottlers for about $7.8 billion in cash or stock. PepsiCo already owned 33% of Pepsi Bottling outstanding shares and 43% of PepsiAmericas outstanding shares.

In April 2009, the New York-based maker of Frito-Lay, Quaker, Pepsi-Cola drinks, Tropicana juices and Gatorade sports drinks made an offer of $6 billion for the acquisitions, which was rejected by the bottlers on valuation grounds.

PEP closed Friday's trading at $62.47, up 0.17 or 0.27%, on a volume of 14.65 million on the NYSE. In after hours, the stock declined 0.01 or 0.02%, trading at $62.46.

PBG closed trading at $38.23, down 0.02 or 0.05%, on a volume of 7.78 million shares on the NYSE. In after hours, the stock gained 0.12 or 0.31%, trading at $38.35.

PAS closed trading at $29.98, up 0.10 or 0.33%, on a volume of 5.81 million shares on the NYSE. In after hours, the stock declined 0.02 or 0.07%, trading at $29.96.

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