Washington - PepsiCo, the maker of Pepsi soft drinks, said Tuesday it had reached a deal to acquire its two key bottlers for $7.8bn, creating one of the largest food and beverage companies.
Under merger agreements, PepsiCo said it would buy all of the outstanding shares of common stock it does not already own in its two largest anchor bottlers - The Pepsi Bottling Group and PepsiAmericas.
PepsiCo presently owns 33% of PBG and 43% of PepsiAmericas.
The company said in a statement that it was offering $36.50 a share for Pepsi Bottling and $28.50 a share for PepsiAmericas under the deal. Both offers are half in cash and half in stock.
"The acquisitions will create one of the largest food and beverage companies globally," PepsiCo said.
The transaction would also "directly complement the transformation efforts already underway" in its North American beverage business.
They included "refreshing" such brands as Pepsi and Gatorade and introducing new products as well as steps to "fundamentally improve" its cost structure.
"The fully integrated beverage business will enable us to bring innovative products and packages to market faster, streamline our manufacturing and distribution systems and react more quickly to changes in the marketplace, much like we do with our food business," PepsiCo chief executive Indra Nooyi said.
"Ultimately it will put us in a much better position to compete and to grow both now and in the years ahead," she said.
PepsiCo, whose larger rival is Coca-Cola, had more than $43bn in 2008 revenues.
It said the new deal was expected to create annual synergies of $300m by 2012 largely due to greater cost efficiency and also improved revenue opportunities.
"The acquisitions are expected to be accretive to PepsiCo's earnings by about 15% per share when synergies are fully realised in 2012," the company statement said.