PepsiCo to Sell Tropicana, Naked and Other Juice Brands for $3.3 Billion
PAI Partners, a French private equity firm, is buying the brands and giving PepsiCo a 39% stake in a joint venture.
PepsiCo is selling North American juice brands like Tropicana and Naked for $3.3 billion, the company announced Tuesday, and plans to use the proceeds to strengthen its balance sheet and invest in its business.
PAI Partners, a French private equity firm, is buying the brands and giving PepsiCo a 39% stake in a joint venture, as well as the exclusive American distribution rights for some channels like food service.
Centerview Partners LLC is acting as PepsiCo’s financial advisor while Gibson, Dunn & Crutcher LLP is lead counsel and Davis Polk & Wardwell LLP serves as antitrust counsel. PAI is using J.P. Morgan Securities LLC as its financial advisor, Willkie Farr & Gallagher LLP as legal counsel, and Latham & Watkins LLP as financial counsel.
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"This joint venture with PAI enables us to realize significant upfront value, whilst providing the focus and resources necessary to drive additional long-term growth for these beloved brands," said PepsiCo Chairman and CEO Ramon Laguarta in a statement on Tuesday.
He went on, "In addition, 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 which are focused on being better for people and the planet."
Frédéric Stévenin, a Managing Partner at PAI, added, "We are delighted to bring these storied beverage brands into the PAI portfolio through another partnership with a leading global food and beverage company. We believe there is great growth potential to be realized through investments in product innovation, expansion into adjacent categories, and enhanced scale in branded juice drinks and other chilled categories.”
Stévenin also said PAI is “thrilled that PepsiCo will remain involved as our partner in the joint venture.”
The transaction will close in late 2021 or early 2022, subject to work council consultations and regulatory approvals.