PepsiCo has joined forces with Grupo Embotelladoras Unidas to create a nationwide beverage company in Mexico.
The joint venture will combine PepsiCo’s beverage manufacturing and distribution operations in Mexico with those of GEUSA, a subsidiary of GEUPEC. Empresas Polar, the largest food and beverage company in Venezuela and a longtime leading bottler of Pepsi-Cola products in that country, will have an equity stake in the joint venture.
With a portfolio including Pepsi, Gatorade, 7Up, Lipton and Santorini, the distribution network created by the new venture will reach 950,000 points-of-sale and 1.7 million households with its direct-to-home delivery system. Its 36,000 employees will operate 287 distribution centers and more than 17,500 sales and delivery vehicles.
"We are confident that the strong partnership between GEUPEC, Empresas Polar and PepsiCo will represent great growth opportunities, make us more competitive and innovative, and allow us to provide excellent service to our customers and consumers," said Juan Gallardo, chairman of GEUPEC.
"We are committed to playing an important role in this joint venture, supported by our operational expertise in the food and beverage industries," added Lorenzo Mendoza, CEO of Empresas Polar. "With our long-term vision and great partners, we are confident in building a highly competitive beverage company for all stakeholders in Mexico."
"This new business model will allow us to create synergies and streamline our supply chain," said Pepsi Beverages Company CEO Eric Foss. "We'll also be quicker, more agile and better able to meet the changing demands of today's consumers."
GEUPEC will initially maintain a majority interest in the joint venture, whose governing board will include representatives of the three equity partners. Miguel Antor, current CEO of Pepsi-Cola Venezuela, a unit of Empresas Polar, has been designated CEO of the new joint venture. Antor's extensive experience in this market includes a 20-year career at Empresas Polar as well as serving as marketing director for PepsiCo's Mexican beverage business.
This transaction is subject to approval by the Federal Competition Commission of Mexico and is expected to be completed by the end of September, 2011.
