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January 30, 2020

PepsiCo’s proposed deal for Pioneer Foods under competition review

Competition authorities in the UK are investigating PepsiCo's proposed purchase of South Africa-based food and beverages business Pioneer Foods Group.

By Dean Best

Competition authorities in the UK are investigating PepsiCo’s proposed purchase of South Africa-based food and beverages business Pioneer Foods Group.

While Pioneer Foods predominately operates in its home market through food names such as Weet-Bix cereal, Sasko flour and Safari snacks, it also runs a UK business manufacturing the granola brand Lizi’s and children’s snacks under the Fruit Bowl label. 

PepsiCo solicited an above-market-bid (US$1.7bn) for Pioneer Foods last July, saying the deal would enable the US food and beverages giant to “gain a solid beachhead for expansion into sub-Saharan Africa by boosting the company’s manufacturing and go-to-market capabilities, enabling scale and distribution”.

However, the UK-based Competition and Markets Authority (CMA), said today (30 January) it is inviting comments from any concerned parties by 20 February to ascertain whether there is any conflict of interest in terms of competition.

Based on those findings, the CMA said it has set a deadline for 26 March to decide whether to launch a further investigation.

PepsiCo declined to comment on the CMA review when contacted by just-food.

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