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Activist investor Elliott Management Corp is reportedly on the verge of finalising a settlement with PepsiCo, according to a recent report by the Wall Street Journal.

This potential agreement comes after Elliott acquired a substantial $4 billion stake in the global beverage and snacks leader in September, aiming to enhance shareholder value and its soda segment.

Elliott's intervention highlights growing concerns regarding PepsiCo's stock performance and competitive positioning in a rapidly evolving market.

The investor has urged the company to adopt aggressive strategies to boost its share price and regain market share within the soda category, which has faced increasing competition from healthier beverage alternatives.

PepsiCo's CEO, Ramon Laguarta, acknowledged the collaborative nature of discussions with Elliott, noting that many of the activist's proposals are already reflected in the company's strategic roadmap.

However, Elliott's suggestion to spin off PepsiCo's expansive North American bottling network remains a point of contention, as Laguarta has yet to provide a definitive response.

In light of recent financial pressures, PepsiCo has initiated cost-cutting measures, including the closure of two manufacturing plants and a reduction of nearly 15% in its product lines. The refocusing aims to streamline operations within its snacks division while enhancing profitability.

Moreover, PepsiCo is betting on the growing consumer preference for healthier options. The company plans to relaunch its popular Gatorade brand, following a successful rebranding of other snack products like Lay's and Tostitos.

Additionally, the introduction of the Propel drink – infused with electrolytes, fibre and protein – demonstrates PepsiCo's commitment to innovation in response to shifting consumer demands. This follows the recent acquisition of prebiotic soda brand Poppi, further diversifying its product portfolio.