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PepsiCo and Wimm-Bill-Dann in $3.8 billion deal

PepsiCo is set to acquire 66% of Wimm-Bill-Dann, Russia's leading branded food and beverage company, in a deal worth $3.8 billion.

08 December 2010

The deal extends PepsiCo's reach into new markets at the same time as expanding its range of healthier products. Wimm-Bill-Dann is a leader in both traditional and value-added dairy products, with a solid position in juice.

The transaction will establish PepsiCo as the largest food-and-beverage business in Russia, make it a leader in the country's fast-growing dairy category and build its presence in key markets in Eastern Europe and Central Asia.

It will also raise PepsiCo's annual global revenues from nutritious and functional foods from approximately $10 billion today to nearly $13 billion. This moves the company closer to its strategic goal of building a $30 billion nutrition business by 2020.

Indra Nooyi, Chairman and Chief Executive said:

"Adding Wimm-Bill-Dann to PepsiCo's portfolio is financially attractive and gives us a strong, high-growth platform in the dairy category."

"It also gives us clear leadership in the food-and-beverage industry in Russia, a fast-growing, strategically important market offering abundant opportunity. At the same time, Wimm-Bill-Dann's strong, value-added dairy business immediately advances our global nutrition strategy to provide consumers around the world nutritious foods and beverages that are accessible, affordable and advantaged by science. Dairy has a huge, untapped potential to bridge snacks and beverages. We see the emerging opportunity to 'snackify' beverages and 'drinkify' snacks as the next frontier in food and beverage convenience."

Zein Abdalla, Chief Executive Officer of PepsiCo Europe said:

"Wimm-Bill-Dann's management team has built an outstanding portfolio of market-leading dairy and juice brands that are loved by consumers across Russia. The combination of Wimm-Bill-Dann and PepsiCo Russia will create a powerhouse business in terms of scale, brand portfolio and system capabilities with the potential to be leveraged across the broader East European and Central Asian region."

Sergei Plastinin, chairman of the Wimm-Bill-Dann board of directors and one of the shareholders who agreed to sell shares to PepsiCo, said:

"The agreement reached with PepsiCo is a historic one for both our company and our country. Wimm-Bill-Dann was founded just 18 years ago with a handful of employees, who were all based in one room, which saw the birth of our company name, our logo and our first juice brand, J7. Today we have over 16,000 people and 38 production facilities. In this time, Wimm-Bill-Dann has created great juice, dairy and toddler and baby food brands that are among the best loved and recognized in Russia and neighboring countries."

"This (deal) represents a tremendous vote of confidence in the future of the Russian market. Integration into PepsiCo also provides our employees with access to a world-class corporate culture and almost unlimited career potential in one of the largest companies in the world."

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