PepsiCo completes $7.8bn acquisitions of two bottlers

Deal expected to create pre-tax synergies of up to $150m.

PepsiCo has completed the $7.8bn strategic acquisitions of its two bottlers, The Pepsi Bottling Group and PepsiAmericas. The company claims that the merger will position it as the largest food and beverage business in North America and the second-largest in the world.

The transactions are expected to create pre-tax synergies of approximately $125m to $150m in 2010 and approximately $400m annually once fully implemented by 2012. The company expects that initial synergies to derive from greater cost efficiencies.

PepsiCo said some of the synergies will be reinvested in high-growth emerging markets, global research and development, and new operating capabilities.

The company added that in Europe and Mexico, it will have better integrated operating systems, with the ability to more quickly implement and execute marketplace programs.

Indra Nooyi, chairman and CEO of PepsiCo, said: "This investment opens up a broad range of new growth opportunities around the world, particularly in North America, which accounts for the majority of our revenues and offers the prospect of significant growth. We have approximately 115,000 employees in the US alone, and we are committed to continuing to invest in this critically important market."