PepsiCo dismisses break-up suggestions

In a reaction to Speculations of a PepsiCo Split, the company has denounced such plans. According to just drinks, the company said “it has no plans to split its snacks and beverage divisions, despite analyst suggestions that it may follow Kraft in its decision to break up its business this week.” A company spokesperson told just drinks that “”We are comfortable that our business model is right for today and right for moving forward.”

Analysts have raised questions about the beverage and snacks sides being “two different tales”. However they also say the combined business gives PepsiCo considerable bargaining power with customers, badly needed in times of increasing retailer leverage on food and beverage producers. But at the end of the day, it might be more about about “unlocking value for shareholders” then about the best business model. As one analyst said “If Pepsi see Fortune Brands and Kraft unlocking value after their splits, it’s not ridiculous to think they could follow suit.”