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comprehensive legal services for businesses call 201-957-0874

PepsiCo denies rumors of merger

Rumors have been swirling that snack food giant PepsiCo Inc. is considering a new corporate strategy. New Jersey shareholders may be interested to know that these rumors include a potential merger with Mondelez International.

The New York headquartered PepsiCo owns a variety of snack brands including Gatorade, Quaker Oats and Frito-Lay, whereas Mondelez owns Nabisco and Cadbury. Last year, Mondelez split from Kraft Foods Group.

The merger between the two companies could be a way for PepsiCo to overcome its issues with its struggling beverage business. However, some worry that a merger between the two would create such a large company that anti-trust issues could be raised which could potentially shut down any union between the corporations.

At this time, PepsiCo refuses to comment on the speculation and insists that they are not interested in large deals. Instead, the company insists that it will move forward and focus on providing value to shareholders and seeking long-term growth. In particular the company seems focused on introducing a new marketing officer to help strengthen the brand.

Like many New Jersey companies, PepsiCo may be looking for a way to survive when one aspect of its company is no longer working. As the beverage business has taken a downturn, PepsiCo may need to expand to other areas of the industry in order to stay relevant in today's rough economy.

For PepsiCo, and for New Jersey businesses, a merger may be the answer to its problems. Unlike other types of business transactions, a publically traded merger can provide capital, a new customer base and additional revenue. New Jersey businesses that are looking to expand, or need help staying afloat in this economy, should consider a merger as part of their long term corporate strategy.

Source: Bloomberg Businessweek, "Pepsi names chief marketing officer," May 31, 2013

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