Drumil Modi, Pune
Fast Moving Consumer Goods (FMCG) giant PepsiCo is set to acquire Siete Foods, a Mexican-American brand known for its heritage-inspired products, for $1.2 billion. This will be PepsiCo’s biggest acquisition in the last five years. The brand is looking to expand its portfolio with healthier food offerings.
This will make PepsiCo’s “better for you brand” even stronger. The acquisition is yet to get regulatory approval. PepsiCo believes that the deal will be closed by the first half of 2025.
Siete Foods came into being in 2014. The Garza family is credited for establishing the company. The company specialises in a wide range of Mexican food offers including salsa, tortillas, seasonings, sauces, cookies and snacks. Siete Foods are curated and designed with varied dietary restrictions kept in mind. The products are a unique blend of healthy while maintaining traditional flavours. The brand has made a significant space for itself in the United States of America owing to the rise in demand for healthy food options by consumers. Siete Foods products are available in all major supermarkets such as Target, Kroger, Whole Foods and CVS as well as in grocery stores, clubs and organic food retailers across the USA.
This is more of a salvation move for PepsiCo as they attempt to enter the healthy food market. This step is also in line with the company’s aim to provide better-quality products. The company has been trying to diversify their portfolio beyond traditional snacks like lays, pringles and walkers chips. Other healthy good brands that PepsiCo has acquired include Bare Snacks, Health Warrior and PopCorners. By acquiring Siete Foods, PepsiCo makes its brand stronger among the Mexican demographic positioning itself as a multicultural brand.
This acquisition takes place in between a massive surge in packaged food companies either being acquired or merged. The packaged food industry is in a race to diversify its offerings and this remains the quickest and the most effective way of expanding the brand.
The leadership from both companies showed their excitement for the merger. Ramon Laguarta, Chairman and CEO of PepsiCo stated that PepsiCo will honour the Mexican heritage of Siete’s offerings and preserve what the brand has built over the years.