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Fritos in Latin America
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November 25, 1998: 8:05 a.m. ET
Pepsi snack division strikes joint venture to expand in Venezuela, Chile
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NEW YORK (CNNfn) - Frito-Lay is making inroads into Latin America.
The $11 billion snack food division of PepsiCo Inc. has entered a joint venture with Savoy Brands International in a bid to boost its international presence.
Savoy itself is a unit of the Empresas Polar SA conglomerate of Venezuela.
The joint venture reportedly covers nine countries, including Venezuela, Chile, Peru, Ecuador and parts of Central America. Frito-Lay and Polar will each own 50 percent of the alliance, except in Chile where Frito-Lay's stake will be 70 percent.
Moreover, Frito-Lay acquired Savoy's business in Argentina.
The company will manage the venture, but declined to disclose the financial value of the deal. Its combined market share for the 10 countries will double to about 50 percent from about 25 percent.
Currently, combined annual sales for Frito-Lay and Savoy in these countries is $330 million.
"If in five years we have not doubled sales, we will have failed," Rogelio Rebolledo, president of Frito-Lay's Latin America and Asia-Pacific regions, told the Wall Street Journal.
Shares of Pepsi (PEP) were off ¼ at 37-1/4 Tuesday on the New York Stock Exchange.
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Frito-Lay
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