UPDATE: PepsiCo Selects Foss To Head Bottling Operations
October 05 2009 - 9:29AM
Dow Jones News
PepsiCo Inc. (PEP) said Eric. J. Foss will head the company's
bottling business once it completes its acquisition of Pepsi
Bottling Group Inc. (PBG) and PepsiAmericas Inc. (PAS).
Foss is currently the chief executive of Pepsi Bottling. PepsiCo
in August announced a $7.8 billion agreement to buy its two largest
bottlers, Pepsi Bottling and PepsiAmericas. The acquisitions are
part of a push to revive its North American beverage business that
has been fighting a slump in sales. Investors have been watching
closely for details on who would head PepsiCo's new bottling
operations after the deals close and for details on how the
beverage company will integrate the bottlers.
Foss' experience makes him a good pick given the heavy lifting
that will be required to integrate the companies and realize cost
and revenue synergies, said ConsumerEdge Research analyst Bill
Pecoriello.
The new PepsiCo unit created after the acquisitions, PepsiCo
Bottling North America, will account for about three-quarters of
its North American volume, PepsiCo said. The unit will remain
separate from its PepsiCoAmerica Beverages unit, which will
continue to oversee independent bottlers, as well as Gatorade and
Tropicana.
"Our focus will be to create a bigger, stronger and faster
organization that can better serve our customers and accelerate our
growth in North America," Foss said. North American soda sales have
been tepid for some time, though there have been signs that the
industry may be past the worst fallout from the recession.
Pepsi Bottling's and PepsiAmericas' international operations
will be managed by PepsiCo's European business after the merger is
completed.
Foss will report to PepsicCo Chairman and Chief Executive Indra
Nooyi. A special advisory board also will be established to aid in
the transition of the bottling business.
Foss was named chief executive and named to the board of Pepsi
Bottling in July 2006, becoming chairman in 2008. He joined the
company in 1982, serving in a number of roles, including chief
operating officer from September 2005 until he became chief
executive.
PepsiCo, Pepsi Bottling and PepsiAmericas shares closed Friday
at $60.90, $37.25 and $29.05, respectively. None traded premarket
Monday.
-By Anjali Cordeiro, Dow Jones Newswires; 212-416-2200;
anjali.cordeiro@dowjones.com
(Tess Stynes contributed to this article.)