PepsiCo To Sell Controlling Stake In Tropicana, Other Select Juice Brands To PAI Partners

pepsico aug03 lt

PepsiCo, Inc. (PEP) has reached an agreement with private equity firm PAI Partners to sell Tropicana, Naked and other select juice brands across North America. The agreement also includes an irrevocable option to sell certain juice businesses in Europe. The combined pre-tax cash proceeds will be approximately $3.3 billion. PepsiCo plans to use the proceeds primarily to strengthen balance sheet and to make organic investments in the business.

PepsiCo will retain a 39% non-controlling interest in a newly formed joint venture. PAI will be the majority shareholder, with PepsiCo retaining exclusive U.S. distribution rights to the portfolio of brands. The juice businesses recorded approximately $3 billion in net revenue in 2020 with operating profit margins that were below the company's overall operating margin in 2020.

PepsiCo CEO Ramon Laguarta said: "It will free us to concentrate on our current portfolio of diverse offerings, including growing our portfolio of healthier snacks, zero-calorie beverages, and products like SodaStream."

PAI Partners invests in market-leading companies across the globe. It is currently invested in Froneri, an ice cream manufacturer, and Ecotone, a provider of healthy and sustainable food.

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