Pepsi India bottler Varun Beverages said yesterday it would buy South Africa-based The Beverage Company in a deal valued at 13.2 billion rupees (R2.9 billion), enabling it an entry into Africa's largest market.
The Beverage Company bottles and distributes PepsiCo-branded non-alcoholic beverages in South Africa and has five manufacturing facilities in the country, in addition to operations in Lesotho, Eswatini, Namibia, and Botswana.
Varun Beverages, one of PepsiCo's largest franchisees outside the US, has the provision to accept minority co-investment from a "large equity fund", it said in a filing.
The company has more than 30 manufacturing units in India, packaging and distributing beverages under the Pepsi, Mirinda and Tropicana labels.
The deal is expected to be completed on or before July 31, 2024, subject to regulatory approvals.
Shares of Varun Beverages closed 3.5% higher on Tuesday ahead of the announcement.
The Gurugram-based firm also signed a memorandum of understanding with the Jharkhand government on Tuesday to set up a manufacturing plant in the state, with a capital expenditure of 4.5 billion rupees.
Varun Beverages’s worth
As of December 2023 Varun Beverages has a market cap of $17.71 billion (R324bn). This makes Varun Beverages the world's 991th most valuable company by market cap.
Varun Beverages produce and distribute a wide range of carbonated soft drinks and a large selection of non-carbonated soft drinks, including packaged drinking water.
Brands sold by the beverage firm include Pepsi, Diet Pepsi, Seven-Up, Mirinda Orange, Mirinda Lemon, Mountain Dew, Seven-Up Nimbooz Masala Soda, Evervess Soda, Duke's Soda and Sting. - With additional reporting by BR Reporter