PepsiCo is to buy out Israel's Strauss Group from their Sabra and Obela dips ventures.
The US giant did not disclose how much it had agreed to pay for the 50% stakes in US-based Sabra Dipping Company and Switzerland-based PepsiCo-Strauss Fresh Dips & Spreads International, which is also known as Obela.
However, Strauss Group said PepsiCo is paying $243.8m. Some $240.8m, which includes a shareholder loan, will be for Sabra with the rest for Obela.
The two ventures have both been in place for more than a decade. Sabra, which focuses on North America, was formed in 2008. Obela, set up in 2011, supplies Australia, New Zealand and Mexico
"As we evolve our food portfolio and bring people more choices for more occasions, our aim is to meet the growing demand for positive choices and on-the-go options," Steven Williams, the CEO of PepsiCo's North American foods unit, said. "Nutritious, simple foods like refrigerated dips and spreads represent a space we have long desired to expand in the US and Canada."
In the first half of 2024, Sabra's sales, 50% net to Strauss, were NIS220m, down 0.6%, and in the second quarter, sales were NIS110m, down 5.5% compared with the corresponding period in 2023.
According to figures released by Strauss Group, Sabra generated an operating profit of NIS4m in the first half of the year. Obela recorded an operating loss of NIS1m
PepsiCo and Strauss have also struck a deal over their Strauss Frito-Lay venture, which markets salty snacks in Israel.
The Doritos maker has granted Strauss Group an option to purchase up to 2.5% of
Strauss Frito-Lay's share capital at an exercise price of up to $9.9m. Strauss Group has paid $100,000 for the option.
Last month, PepsiCo confirmed a deal to buy Mexican-American snacks maker Siete Foods for a fee of $1.2bn.
Siete Foods was founded in 2014 by Veronica Garza and her family in Austin, Texas. The company produces grain-free and dairy-free Mexican-American foods.
