India's Varun Beverages to enter S. Africa with $159 mln deal (updated)

Varun Beverages

19/12/2023 11:58

(Adds background, details on deal from paragraph 2 onwards)
       BENGALURU, Dec 19 (Reuters) - Pepsi India bottler Varun
Beverages  VARB.NS  said on Tuesday it will buy South
Africa-based The Beverage Company in a deal valued at 13.2
billion rupees ($158.71 million), 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  PEP.O  largest
franchisees outside the United States, has the provision to
accept minority co-investment from a "large equity fund", it
said in a filing.
    The company has over 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.
    
($1 = 83.1725 Indian rupees)

  

 (Reporting by Navamya Ganesh Acharya in Bengaluru; Editing by
Janane Venkatraman)
 ((Navamya.GaneshAcharya@thomsonreuters.com; +91 8805175330 ;))