Varun Beverages Ltd, soft drink giant PepsiCo India’s bottling partner, has reportedly received approval from the Competition Commission of India (CCI) for its proposal to get franchise rights of the foods and snacks major in western and southern India.
As per the Varun Beverages regulatory filing, the Competition Commission of India in its meeting conducted on March 22 assessed & accepted the proposed acquisition. In February, the company had announced its plans to obtain franchise rights of PepsiCo in western and southern regions, cite trusted sources.
The company’s board and PepsiCo India Holdings had agreed to enter into a binding agreement to gain franchise rights for the two regions for national sales, bottling, and distribution footprint across seven states as well as five union territories, cited sources familiar with the development
The bottling company further stated that on completing the acquisition, it will be a franchise of PepsiCo beverages business in 27 states and seven union territories.
Last year in January, Varun Beverages signed a pact with PepsiCo which involved sale and distribution of the latter’s entire Tropicana line of juices as well as Quaker value-added Dairy and Gatorade in north and east India. The company already had manufacturing, sales, and distribution rights for PepsiCo’s Tropicana Frutz and Tropicana Slice in the two regions, claimed sources.
In a recent turn of events, Varun Beverages reportedly announced the opening of its new facility worth INR 550 Crore located in Pathankot, Punjab, which would manufacture products from PepsiCo’s beverage portfolio. The integrated facility will manufacture the cola major’s dairy-based products, aerated drinks, Tropicana range of fruit juices, Aquafina water, Lipton Iced Tea, and Gatorade, reported sources.
In context of the new facility, Ravi Jaipuria, Chairman of Varun Beverages, was quoted saying that the facility is located close to target markets which will minimize time to market and allow optimization of goods and logistics costs, thereby contributing to margin expansion.
The facility is also estimated to generate more than 5,000 direct and indirect job opportunities in the state, reported sources.