PepsiAmericas Announces Joint Venture with Cabcorp

The boards of directors of the two companies have approved the terms of the joint venture. Closing of the transaction is subject to certain regulatory approvals. The two companies expect the transaction to close most likely in the third quarter.

19/05/09 PepsiAmericas, Inc. and the Central America Beverage Corporation (CABCORP) announced a strategic joint venture that provides a strong platform for growth and geographic expansion.

PepsiAmericas and CABCORP have formed a joint venture to combine PepsiAmericas' Caribbean business, excluding the Bahamas, with CABCORP's Central American operations, including Guatemala, Honduras, El Salvador and Nicaragua. As the 12th largest company in Central America and with sales of $480 million in 2008, CABCORP provides scale and local management expertise to drive growth in the combined joint venture. In addition to the PepsiCo brands, the combined business will produce and sell an expanded product portfolio across these territories. Under the agreement, CABCORP will control a majority 82 percent ownership interest, with PepsiAmericas controlling the remaining 18 percent.

"The combination of our Caribbean business with CABCORP provides the best strategic alternative to create value from this region," said Robert C. Pohlad, Chairman and CEO of PepsiAmericas. "In addition to leveraging scale and expertise, we believe the formation of this joint venture will allow us to participate in the higher growth Latin American markets where CABCORP currently operates."

"We are very excited about the potential of this joint venture," said Carlos Enrique Mata Castillo, President of CABCORP. "The combination of our product offerings, territories and sales capabilities in Central America and the Caribbean should put CABCORP in a stronger position to take advantage of future expansion opportunities in the region."

"CABCORP has a long history in the Pepsi business," added Kenneth E. Keiser, President and COO of PepsiAmericas. "We are excited about the strong marketplace execution and operational capabilities of CABCORP that we believe will provide accelerated growth opportunities for PepsiAmericas."

The boards of directors of the two companies have approved the terms of the joint venture. Closing of the transaction is subject to certain regulatory approvals. The two companies expect the transaction to close most likely in the third quarter. PepsiAmericas expects this transaction will not materially impact its previously announced 2009 adjusted earnings per share outlook. The terms of the deal were not disclosed.