Varun Beverages may acquire PepsiCo’s franchisee rights for Odisha and part of Madhya Pradesh

The Board of Directors of Varun Beverages (VBL), a key player in the beverage industry, has approved its intent to enter into a binding agreement to acquire PepsiCo India’s previously franchised territories of the state of Odisha and parts of Madhya Pradesh along with three manufacturing units at Cuttack, Bargarh and Bhopal (Mandideep).
 
This approval is subjected to the satisfactory completion of due diligence and final approval of PepsiCo. Upon completion of this acquisition, VBL will be a franchisee for PepsiCo products across 18 states and two Union Territories. These are highly under-penetrated regions and provide huge opportunity for increasing volumes and gaining market share. 
 
The proposed acquisition is in line with the company’s strategy to expand into contiguous territories to garner better operating leverage and asset utilisation through economies of scale.
 
Varun Beverages (VBL) is a key player in the beverage industry and one of the largest franchisees of PepsiCo in the world, outside USA. The company produces and distributes a wide range of carbonated soft drinks (CSDs) as well as a large selection of non-carbonated beverages (NCBs), including packaged drinking water sold under trademarks owned by PepsiCo.