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PepsiCo said today it has completed its merger with The Quaker Oats Company, creating a $25 billion food and beverage company sharply focused on the rapidly growing consumer demand for convenience.
"This is an historic day for PepsiCo," said Steve Reinemund, PepsiCo chairman and CEO. "Since this merger was announced in December, we've been making plans to build a truly outstanding company that's perfectly positioned to build on the many opportunities we see for convenient foods and beverages. We are now well prepared to make that dream a reality."
The merger combines two strong, highly complementary businesses to form the world's fifth-largest food and beverage company, ranked by revenues. With the merger complete, PepsiCo generates $25 billion in pro-forma
annual revenues and owns 13 consumer brands that each post more than $1 billion in annual retail sales.
"Quaker brings to PepsiCo a very wide range of benefits that touch virtually every one of our businesses," Reinemund said. "With Gatorade, we'll add the leading isotonic brand to our beverage portfolio. Quaker's
highly-efficient broker-warehouse system will help Tropicana accelerate national distribution and growth of its shelf
stable products. The Quaker brand and the company's line of wholesome snacks give us a ideal way to expand beyond salty snacks. And bringing our companies together will create literally hundreds of millions of dollars in
purchasing, manufacturing and distribution synergies."
"We are particularly fortunate to have the benefit of the Quaker leadership team," Reinemund said. "I believe Quaker's leaders will enhance PepsiCo's management strength significantly."
Under terms of the merger, Quaker shareholders will receive 2.3 shares of PepsiCo common stock in exchange for
each share of Quaker common stock they own. Based on the number of Quaker shares outstanding yesterday, PepsiCo expects to issue approximately 306 million additional shares of its common stock to Quaker shareholders. PepsiCo shareholders will continue to own their existing shares of PepsiCo common stock. Shares of the combined
company, which is known as PepsiCo, will be traded on the New York Stock Exchange and the Chicago Stock Exchange under the symbol "PEP."
PepsiCo brands that each generate $1 billion or more in annual retail sales will now include: Pepsi, Mountain Dew, Diet Pepsi, Lay's potato chips, Gatorade, Tropicana Pure Premium, Doritos, Quaker, Ruffles, 7UP (outside the U.S.), Cheetos, Mirinda and Lipton Teas.