Pepsico to offload its juice brands
Print Edition
PepsiCo will sell Tropicana and other juices to a private equity firm in a US$3.3 billion deal. The New York drink and snack company will keep a 39 percent non-controlling stake in a newly formed joint venture in the deal with PAI Partners.
Juice sales began to decline significantly in the early 2000s when low-carb diets grew in popularity, and that trend has continued with more families choosing instead to buy waters or other no- or low-calorie drinks.
Juice consumption in the US peaked in 2003 at 27.2 billion liters, but by 2017, that had fallen to 11.3 billion liters, wrote Brian Sudano, the managing partner of Beverage Marketing Corp.
The juice business delivered about US$3 billion in revenue last year, but at operating profit margins below the company’s overall margins.
PepsiCo Chairman and CEO Ramon Laguarta said the deal “will free us to concentrate on our current portfolio of diverse offerings, including growing our portfolio of healthier snacks, zero-calorie beverages, and products like SodaStream.”
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