The world's No.2 soft drink firm PepsiCo has agreed to buy Russia's top juice maker Lebedyansky for $1.5-2 billion to boost its modest Russian juice market share, a newspaper reported on Monday.
Kommersant business daily said the deal would take place before the year end, and PepsiCo would buy over 76 percent of Lebedyansky for $1.5-$2 billion, implying a possible premium to the current market capitalization of $1.95 billion.
Lebedyansky and PepsiCo declined immediate comments.
Some 23 percent of Lebedyansky shares are freely floated, while 76 percent are controlled by a group of Russian businessmen, including former director Nikolay Bortsov and his son Yuri, the firm's chairman.
PepsiCo controls around one fifth of the Russian soft drink market and around a third of potato chip sales, but currently controls just 2 percent of the Russian juice market through the brand, Tropicana.
PepsiCo's main rival CocaCola controls over one fifth of the Russian juice market after the $530 million purchase of producer Multon in 2005. Lebedyansky controls over 27 percent of the Russian juice market, Reuters reports.
Kommersant said Deutsche Bank was advising PepsiCo on the deal.
Prime-TASS News reported that the Russian juice company will plough US$50m into the new plant, which is expected to be operational in October 2009. Construction is set to begin later this year in the Novosibirsk region of the country, the news service said.
Earlier this year, Lebedyansky was pipped to the purchase of Ukrainian juice company Sandora by PepsiAmericas and PepsiCo, who bought the company for US$542m.
The company posted a 14% rise in net income for 2006, which came in at $85.4m, on the back of a 38% increase in sales to $710m, just-drinks.com reports.
Prepared by Alexander Timoshik
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