PepsiCo, Inc. announced that it has entered into an agreement with PAI Partners to sell Tropicana, Naked and other select juice brands across North America, and an irrevocable option to sell certain juice businesses in Europe, which will result in combined pre-tax cash proceeds of approximately $3.3 billion while retaining a 39 % non-controlling interest in a newly formed joint venture. PAI, a leading private equity firm with strong experience in the food and beverage space, will be the majority shareholder of the transferred business, with PepsiCo retaining exclusive U.S. distribution rights to the portfolio of brands in its best-in-class, chilled Direct Store Delivery for small-format and foodservice channels.
“This joint venture with PAI enables us to realise significant upfront value, whilst providing the focus and resources necessary to drive additional long-term growth for these beloved brands,” said PepsiCo Chairman and CEO Ramon Laguarta. “In addition, it will free us to concentrate on our current portfolio of diverse offerings, including growing our portfolio of healthier snacks, zero-calorie beverages, and products like SodaStream which are focused on being better for people and the planet.”
“We are delighted to bring these storied beverage brands into the PAI portfolio through another partnership with a leading global food and beverage company. We believe there is great growth potential to be realised through investments in product innovation, expansion into adjacent categories, and enhanced scale in branded juice drinks and other chilled categories,” said Frédéric Stévenin, a Managing Partner at PAI. “We are also thrilled that PepsiCo will remain involved as our partner in the joint venture as we execute our plans to drive the future success of these brands.”
These juice businesses delivered approximately $3 billion in net revenue in 2020 with operating profit margins that were below PepsiCo’s overall operating margin in 2020. PepsiCo expects to use the proceeds from the sale of these assets primarily to strengthen its balance sheet and to make organic investments in the business. The transaction is expected to close in late 2021 or early 2022, subject to customary conditions, including works council consultations and regulatory approvals.
About PAI Partners
PAI Partners is a pre-eminent private equity firm, investing in market-leading companies across the globe. It has significant experience in the food and beverage space and is currently invested in Froneri, the world’s #2 ice cream manufacturer, and Ecotone, a leader in healthy and sustainable food. It manages around €15 billion of dedicated buyout funds and, since 1994, has completed 84 investments in 11 countries, representing over €65 billion in transaction value. PAI has built an outstanding track record through partnering with ambitious management teams where its unique perspective, unrivalled sector experience and long-term vision enable companies to pursue their full potential – and push beyond.
Endress+Hauser BioSense to develop equipment and methods for fast molecular analyses
Increased safety in food production and other process applications is the declared aim of the joint venture between Endress+Hauser and Hahn-Schickard. To this end, both partners have established Endress+Hauser BioSense GmbH based in Freiburg, Germany. Its aim is to enable rapid, on-site molecular analyses for the detection of bacterial or viral contamination in water and beverages, genetic modifications in food or contaminated milk.
The research and development service provider Hahn-Schickard has been working closely for many years with the Department of Microsystems Engineering at the University of Freiburg to develop rapid diagnostic tests that can detect extremely small concentrations of infectious pathogens with portable instruments. The joint venture is now aiming to transfer this technology from the field of medical diagnostics to industrial process and laboratory automation applications.
During the first few months, Endress+Hauser BioSense will operate in spaces located at the university and Hahn-Schickard. Next year the company will move into the university’s innovation center, FRIZ, currently under construction on the campus of the Faculty of Engineering. The start-up will thus expand Endress+Hauser’s activities in Freiburg, where developers are already working on new sensor technologies, biosensors and Industry 4.0 solutions.
In the development of equipment and methods for molecular analyses for process and laboratory environments, Endress+Hauser BioSense will be working closely with IST Innuscreen GmbH in Berlin, which is also part of the Endress+Hauser Group. IST Innuscreen offers a broad portfolio of nucleic acid isolation and molecular diagnostics products and among other things supplies kits and assays for PCR diagnostics.
Experienced leadership team
The joint venture is 75 percent owned by Endress+Hauser, with the remaining 25 percent held by Hahn-Schickard. Dr Nicholas Krohn, who has in-depth knowledge and experience in the field of food analysis, will serve as managing director of the new company. Dr Stefan Burger and Dr Martin Schulz, two long-time employees of Hahn-Schickard who obtained their doctorates in the field of molecular diagnostics at the University of Freiburg, will round out the management team.
Joint venture leverages manufacturing expertise, global go-to-market capabilities, and food and beverage industry experience to create and scale innovative ingredient solutions
Grupo Arcor, the leading food company of Argentina, and Ingredion Incorporated, a leading global ingredient solutions provider to the food and beverage industry, have signed an agreement to create a joint venture that will leverage the two companies’ manufacturing expertise, complementary geographic footprints and commercial capabilities to broaden food and beverage ingredient offerings to customers in Argentina, Chile and Uruguay. Arcor and Ingredion will hold a 51 % and 49 % stake, respectively. The joint venture will have a combined turnover of more than US$ 300 million.
- Arcor will transfer its ingredient operations to the joint venture, which includes one manufacturing facility in Lules (province of Tucumán) and two manufacturing facilities in the Industrial Complex Arroyito (province of Córdoba).
- Ingredion will transfer its Argentina, Chile and Uruguay operations to the joint venture, which includes two manufacturing facilities in the districts of Chacabuco and Baradero (province of Buenos Aires).
The manufacturing facilities produce value-added ingredients, such as glucose syrups, maltose, fructose, starch and maltodextrins that are essential to the food, beverage and pharmaceutical industries.
The joint venture will be managed by a jointly appointed team of executives who will be responsible for integrating the combined operations to market, sell and manufacture ingredients within Argentina, Chile and Uruguay and to further optimize the manufacturing network and support functions to create incremental shareholder value.
The joint venture will operate on a stand-alone basis and upon the closing of the transaction, Arcor will consolidate the business. Ingredion will account for its interest in the joint venture under the equity method of accounting, and hyperinflation accounting will be applied to equity income for Ingredion’s reporting purposes.
The joint venture has been approved by each company’s board of directors and is subject to regulatory approvals and customary closing conditions. Infupa is acting as financial adviser to Arcor and Bruchou as its legal counsel; Finanzas & Gestión is acting as financial adviser to Ingredion and Baker & McKenzie as its legal adviser.
Ingredion Incorporated (NYSE: INGR) headquartered in the suburbs of Chicago, is a leading global ingredient solutions provider serving customers in more than 120 countries. With 2019 annual net sales of more than US$6 billion, the company turns grains, fruits, vegetables and other plant-based materials into value-added ingredient solutions for the food, beverage, animal nutrition, brewing and industrial markets. With Ingredion Idea Labs® innovation centers located around the world and nearly 12,000 employees, the Company co-creates with customers and fulfills its purpose of bringing the potential of people, nature, and technology together to make life better. Visit ingredion.com for more information and the latest Company news.
Arcor is the leading food company in Argentina, the first global producer of hard candy, and the main confectionery exporter in Argentina, Chile, and Peru. It has more than 40 industrial plants and employs nearly 20,000 collaborators. Arcor has entered into many alliances, like the one between Bagley Latinoamérica and the French group Danone, the Grupo Bimbo partnership in Mexico, the strategic alliance with Coca-Cola for the joint development of new products and the creation of Kamay Ventures, one of main open capital investment funds in Argentina. Grupo Arcor’s daily production volume amounts to 3 million kilograms and its brands are sold in more than 100 countries worldwide. Its annual turnover for 2019 was US$ 2.5 billion.
Moriyama first to run commercial production using SIG filling technology in Japan
Tokyo-based 50-50 joint venture DNP • SIG Combibloc Co., Ltd has announced that pioneering dairy manufacturer Moriyama is the first customer in Japan to run commercial production using SIG filling technology and the first to offer premium ready-to-drink (RTD) products in SIG carton packs locally filled in Japan.
Japan is one of the most competitive and highly developed markets for food and beverages in the world, with innovation being the key to success. Food safety and quality is of paramount importance with extremely high requirements on both aseptic and industrial standards. SIG’s market entry in Japan with Moriyama clearly demonstrates such high-quality standards, for both filling technology and packaging.
Moriyama’s new premium RTD products, in combifitMidi and combiblocMidi 1000 ml aseptic carton packs from SIG, will be filled at the company’s production plant in Kanagawa Prefecture on a CFA 812 filling machine from SIG. The new products, including cocoa, organic tea and organic coffee, and packaging fit perfectly within Moriyama’s extensive and diverse product portfolio, offering a high level of differentiation in such a mature and challenging environment.
Moriyama is also an important co-packer within the Japanese market and the new filling technology from SIG will benefit this side of its business, helping to expand its market position in the longer term.
DNP • SIG Combibloc Co., Ltd and Moriyama work together on product innovation and differentiation as part of SIG’s Value Proposition, which aims to deliver innovative product and packaging solutions that enable businesses to satisfy ever-changing needs.
Louis Dreyfus Company (LDC) and Luckin Coffee (Luckin) have signed an agreement to establish a joint venture (JV) to develop a co-branded Luckin Juice business in China. The signing ceremony in Singapore was attended by Zhengyao Lu, Chairman of Luckin Coffee, Margarita Louis-Dreyfus, Chairperson of Louis Dreyfus Holding B.V., Ian McIntosh, CEO of LDC, and other members of senior management from the two companies.
The business will focus on co-branded Not From Concentrate (NFC) orange, lemon and apple juices, for which LDC masters the full value chain from its farms to customers at destination, and plans to build its own bottling plant in the future. It also plans to bottle and brand other fruit and vegetable juices. Luckin Coffee stores will play an important role as sales outlets, while the business also plans to market its juices via other channels.
“China is the fastest-growing NFC market globally and, together, Luckin and LDC see a significant opportunity to offer high quality, sustainably-developed NFC juices to the Chinese consumer. We are pleased to be partnering with one of the world’s largest citrus fruit growers and juice suppliers to launch a co-branded Luckin Juice and continue our ambitious growth plans,” said Jinyi Guo, Luckin Coffee Senior Vice President and Co-founder. “There are strong synergies between our leading-edge marketing and consumer approach, and LDC’s great juice supply capacity, global reach and strong value chain expertise. Through the joint venture with LDC, Luckin is extending upstream toward production, giving greater product quality control along the whole process and the ability to offer better products, a better experience and services to consumers, to further meet their diverse product needs. In the future, Luckin Coffee will further reduce costs to meet the needs of broader consumers and increase their consumption frequency.”
Accelerating our strategic alliance with Luckin Coffee through this new JV is very positive,” said James Zhou, LDC Global Vice President and regional head for LDC North Asia. “This fits perfectly with our corporate strategy to move further downstream toward the end consumer, in particular through partnerships, and with our growth ambitions in China. LDC has been in the juice business for over 30 years and this is an excellent fit with our Juice Platform’s strategy. Our areas of expertise are totally complementary, with LDC’s know-how in managing a sustainable juice value chain and Luckin’s knowledge of the Chinese consumer, marketing and digital platform know-how, and established consumer base. We have all the ingredients for a true win-win situation.”
Founded in 1851, LDC is one of the world’s leading merchants and processors of agricultural goods. It is also one of the world’s largest juice production and supply companies, committed to producing high-quality fruit juice products, with sustainably-grown fruit from Brazil and other global sources, with built in traceability. LDC has been active for more than 40 years in China, where it operates today across the value chain in a wide range of commodities, including grains, oilseeds, cotton, sugar, rice and juice, in almost every province in the country. Luckin Coffee is committed to providing customers with high-quality, cost-effective and convenient products, through in-depth cooperation with top suppliers in various fields.
Production of crystalline betaine under a joint venture between AGRANA and The Amalgamated Sugar Company (USA)
The fruit, starch and sugar group AGRANA is constructing a betaine crystallisation plant at its sugar refinery in Tulln (AUT) under a joint venture with US-based Amalgamated Sugar. The official ground-breaking ceremony for this project took place on April 9th. The new plant, entailing the investment of around € 40 million, will take a year to construct.
AGRANA has been processing the sugar beet molasses obtained during the production of sugar at its Tulln site to make liquid betaine since 2015. The new plant, with a production capacity of around 8,500 metric tons of crystalline betaine per year, will make Tulln only the third manufacturing site worldwide where premium-quality, natural crystalline betaine is produced.
“We are looking forward to a successful partnership to produce premium-quality crystalline betaine. Diversification by means of betaine in our Sugar segment is essential to ideally exploit the full potential of sugar beets. This investment in a greater depth of sugar refining is therefore a top priority in the interests of safeguarding competitiveness,” as the CEOs of AGRANA and Amalgamated, Johann Marihart and John McCreedy, both agree.
The natural substance betaine, found in sugar beet molasses, is characterised by numerous positive properties and can be used in many applications. Betaine is a methyl donor and has osmoregulatory properties, aids the liver to process fats, and biologically degrades the amino acid homocysteine, which can damage blood vessels when in high concentrations.
Betaine is used not only in food supplements and sport drinks to promote muscle development, but also in livestock rearing as a component in animal feeds. Due to its osmoregulatory properties at a cellular level, betaine is also used in cosmetic products. In tensides and detergent substances (e.g. shampoos and conditioners), betaine acts to stabilise the formation of foam and also conditions and strengthens the hair.
Del Monte Pacific Limited and Fresh Del Monte Produce Inc. announced a series of new joint ventures between the two companies that will result in expanded refrigerated offerings sold across all distribution and sales channels, and a new retail food and beverage concept modeled after an already successful Fresh Del Monte Produce business in the Middle East. These joint ventures will initially focus on the U.S. market with the potential for expansion into other territories where the companies’ businesses complement each other. This will also greatly increase the scale of the Del Monte® brand by expanding into more high-quality, healthy and convenient product options for consumers.
A major joint initiative is the introduction of Del Monte® branded retail outlets, featuring an assortment of nutritious foods and beverages to meet the increasing demands of consumers for healthier food options. The companies also announced that they are collaborating on several product innovations, including a line of chilled juices, new varieties of prepared refrigerated fruit snacks, and guacamole and avocado products.
The collaboration offers the opportunity for each partner to share expertise and optimize economies of scale in product development, operations, sourcing, supply chain, marketing and distribution.
In addition to retail and new product ventures, the companies have also agreed to a long-term mutual supply agreement to accelerate the expansion of Del Monte® product sales in various markets around the world.