Pioneer Foods is one of the largest South African producers and distributors with a range of branded food and beverage products, posting revenue of R20.2bn ($1.45bn) in 2018. It operates across South Africa and exports to 80 countries around the world, including many across Africa. Brands include Weet-Bix, Liqui-Fruit, Ceres, Sasko, Safari, Spekko and White Star.
Announced on Friday, the acquisition is valued at approximately $1.7bn and is subject to a Pioneer Foods shareholder vote, certain regulatory approvals and other customary conditions. Closing is expected by Q1 of calendar year 2020.
Base for African expansion
PepsiCo says Pioneer Foods has a “robust, locally relevant product portfolio that complements PepsiCo’s current lineup, with strong positions in cereals, juices and other African nutritional food staples.”
The acquisition will also give PepsiCo a ‘solid beachhead’ for expansion into Sub-Saharan Africa by boosting its manufacturing and go-to-market capabilities.
PepsiCo Chairman and CEO, Ramon Laguarta, said: "Pioneer Foods represents a differentiated opportunity for PepsiCo and allows us to immediately scale our business in Africa.
"Pioneer Foods forms an important part of our strategy to not only expand in South Africa, but further into sub-Saharan Africa as well.
"Our businesses are highly complementary, and we look forward to working with the Pioneer Foods team to successfully build and implement a shared vision in the region."