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PepsiCo Plans to Spin Off Bottling Division

September 26, 1998|Times Wires Services

Beverage giant PepsiCo Inc., which shed its low-profit fast-food businesses KFC and Pizza Hut last year, said it will split its North American bottling company from its drinks business. The No. 2 soft drink maker said the new structure will make it easier for the bottling business to go public, an option the company has been studying since July. Analysts have said Pepsi would raise "many billions of dollars" if it were to mimic Coca-Cola Co.'s spinoff of Coca-Cola Enterprises Inc., in which the parent initially retained 49% of the bottler. The bottling unit would be called Pepsi Bottling Group and would comprise all North American bottling operations owned by PepsiCo. The concentrate unit would be called Pepsi-Cola North America and comprise non-bottling elements. In NYSE trading, shares of Purchase, N.Y.-based PepsiCo fell 56 cents to close at $30.44.

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