Varun Beverages made it known on Monday that the board of the company approved plans to acquire the franchise rights of PepsiCo for the south and west regions of the country. The company, in a regulatory filing, said that it will take over the sales, bottling, and distribution of the product in seven additional states and five additional union territories.
The acquisition will be completed once the required statutory approvals are made. Post acquisition, Varun Beverages will have the franchise rights for twenty-seven states and seven union territories, making it PepsiCo’s national bottling partner.
PepsiCo will continue to develop the portfolio of the company and work on the category creation and brand building of the beverage.
The planned acquisitions are in accordance with the company’s strategy and will aid with scaling up the company and achieving efficiency and operational productivity, resulting in profitable growth and higher revenues.
The company, however, did not reveal the financial details of the acquisition. The share price of the company, after the announcement of the board approval, increased by 4.7 per cent intraday on Monday.
Source: Business Today and Money Control