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PepsiAmericas and PepsiCo To Jointly Acquire Leading Juice Company in Ukraine


PepsiAmericas, Inc. (NYSE: PAS) and PepsiCo (NYSE: PEP) today announced that they have reached an agreement to jointly acquire 80 percent of Sandora, LLC (“Sandora”), the leading juice company in Ukraine. The acquisition, for a total purchase price of $542 million plus assumed debt, provides PepsiAmericas and PepsiCo a strong platform for growth in the emerging Ukrainian market.

Ukraine is one of the fastest growing beverage markets in Europe with more than 46 million consumers. Sandora has established itself as the leader in the high growth juice category with a range of distinctly positioned brands that represent approximately half of the total juice volume consumed in Ukraine. With over 3,500 employees, Sandora has a powerful sales and distribution organization and two modern production facilities located in Nikolaev.

“We’re excited to extend our strong partnership with PepsiCo to create a new model for beverage growth in Ukraine,” said Robert C. Pohlad, Chairman and Chief Executive Officer of PepsiAmericas. “We have a clear strategy to grow through the expansion of our international business and Sandora is a great fit. It provides immediate scale in a high growth market and a strong business platform to leverage and expand into other categories. Ukraine’s emerging economy and beverage market, coupled with Sandora’s strong brands and distribution capabilities, provide significant growth potential.”

“Our expansion into Ukraine adds another important contiguous market to our international portfolio, following Romania last year,” said Kenneth E. Keiser, President and Chief Operating Officer of PepsiAmericas. “This acquisition will allow us to further leverage our capabilities, infrastructure and go-to-market system.”

“Sandora’s market-leading brands will be a wonderful addition to our portfolio,” said Michael White, vice chairman of PepsiCo and chief executive officer of PepsiCo International. “We look forward to working in partnership with the Sandora team and to continuing to serve consumers throughout Ukraine.”

PepsiAmericas and PepsiCo will acquire 80 percent of Sandora through a new joint venture in which PepsiAmericas will hold a 60 percent interest. Leveraging the capabilities and experience of the Sandora team, PepsiAmericas will manage the day-to-day operations of the business, while PepsiCo will oversee the brand development. The joint venture expects to acquire the remaining 20 percent interest in Sandora in November 2007.

The transaction, expected to close in the third quarter of 2007, is subject to customary regulatory approvals. PepsiAmericas will consolidate the joint venture into its financial results. PepsiCo will recognize the earnings of the joint venture as equity income in PepsiCo International’s line of business. While PepsiAmericas expects the acquisition to be $0.02 to $0.03 dilutive in 2007, PepsiAmericas maintains its full year adjusted earnings per share outlook of $1.35 to $1.40. PepsiAmericas expects the transaction to be $0.01 accretive to earnings per share in 2008. The transaction will have no impact on PepsiCo’s previously announced earnings per share guidance for 2007.


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