In connection with this acquisition, PepsiCo will offer to acquire the remaining shares of Wimm-Bill-Dann through an offer following completion of that acquisition at such time and on terms as are mandated by Russian law, and PepsiCo may acquire additional shares in other transactions.
The transaction will establish PepsiCo as the largest food and beverage business in Russia, make it a leader in the country’s fast-growing dairy category and build its presence in key markets in Eastern Europe and Central Asia.
It will also raise PepsiCo’s annual global revenues from nutritious and functional foods from approximately $10bn today to nearly $13bn. This moves the company closer to its strategic goal of building a $30bn nutrition business by 2020.
“Adding Wimm-Bill-Dann to PepsiCo’s portfolio is financially attractive and gives us a strong, high-growth platform in the dairy category,” said Indra Nooyi, PepsiCo chairman and CEO. “It also gives us clear leadership in the food-and-beverage industry in Russia, a fast-growing, strategically important market offering abundant opportunity. At the same time, Wimm-Bill-Dann’s strong, value-added dairy business immediately advances our global nutrition strategy to provide consumers around the world nutritious foods and beverages that are accessible, affordable and advantaged by science.
“Dairy has a huge, untapped potential to bridge snacks and beverages. We see the emerging opportunity to ‘snackify’ beverages and ‘drinkify’ snacks as the next frontier in food and beverage convenience.”
“Wimm-Bill-Dann is a terrific business with significant opportunities,” said Zein Abdalla, CEO of PepsiCo Europe. “Wimm-Bill-Dann’s management team has built an outstanding portfolio of market-leading dairy and juice brands that are loved by consumers across Russia. The combination of Wimm-Bill-Dann and PepsiCo Russia will create a powerhouse business in terms of scale, brand portfolio and system capabilities with the potential to be leveraged across the broader East European and Central Asian region.”
Under the acquisition agreement, PepsiCo will acquire 66% of Wimm-Bill-Dann from a group of shareholders and subsidiaries of Wimm-Bill-Dann. The approximately $3.8bn PepsiCo will pay to acquire the stake in Wimm-Bill-Dann implies a total enterprise value of approximately $5.4bn.
The price being paid by PepsiCo to the selling shareholders – $33.00 per ADR share (which is equivalent to $132.00 per ordinary Russian share) – represents a premium of 32% to the 30-day average trading price of Wimm-Bill-Dann’s ADR shares.
The acquisition is subject to customary closing conditions, including receipt of certain regulatory approvals.
Source: PepsiCo
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