Pepsi and Baicao, what do you think of the pair of red and blue CP?
Editor’s note: This article comes from the WeChat public account “FBIF Food and Beverage Innovation” (ID: FoodInnovation).
Author: Momo (Wenky)
Edit: Bobo
February 23, I think you announced that you plan to sell Hangzhou Holmes Food Co., Ltd. (Baicao) to PepsiCo (NASDAQ: PEP) for US$705 million, which has attracted widespread attention in the industry. At the time, Ke Ruinan, PepsiCo’s global chief operating officer and chief executive of the Asia-Pacific region, said he expected to be approved for acquisitions within the next 4-6 months.
And the process was faster than expected. Last night, FBIF learned from an internal letter written by Qiu Haoqun, chairman of Baicao, to employees that PepsiCo’s acquisition of Baicao has been approved by the Chinese government regulator and completed Delivery.
Baicao Flavor Internal Letter
This means that Baicao has officially become a member of PepsiCo. It is worth noting that Baicao will maintain its independent operation as an independent brand.
What is the significance of “Double Hundred” to formally hold hands for Baicao and PepsiCo? What cooperation plans does “Double Hundred” have in the future? What impact will it have on China’s snack food landscape? Today FBIF will exclusively disclose the “Double Hundred” plan.
01Baicao officially joined PepsiCo family and will operate independently as an independent brand
When the news of the proposed acquisition came out in February, “Double Hundred” has attracted much attention from the market. This is the first time PepsiCo has acquired a Chinese snack food company in 40 years. As one of China’s leading snack food brands, Baicaowei is a household name. Baicaowei’s 2019 performance report shows that the company’s total revenue in 2019 is about 5 billion yuan, ranking first in the snack food industry.
In February, there were a lot of discussions in the industry about why you want to sell Baicao and why PepsiCo chose to buy Baicao. And from todayIn the internal letter out of the herbal flavor, we see the explanation of the herbal flavor for the acquisition.
It can be seen from the internal letter that this acquisition is the result of a joint agreement between PepsiCo, Miss You and Baicao based on the brand’s own development needs, and is in line with their respective development plans and expectations. In the internal letter, Qiu Haoqun, chairman of Baicao also expressed his hope that Baicao will grow in a multi-compatible culture.
For the post-acquisition cooperation news that the outside world pays attention to, we bring an exclusive answer to the internal letter.
1. Why did you hold hands this time?
Bai Caowei describes this “Double Hundred” alliance with “like-minded, highly complementary”.
First of all, PepsiCo and Baicao are the same. Both companies are on the big track of the food industry. Their goals and actions in making products and brands are the same.
Second, the two teams have many similar genes: Baicao and PepsiCo both focus on continuous innovation and are at the forefront of the industry. For example, PepsiCo developed China’s first artificial meat snack smoked small intestine last year. PepsiCo launched Coke coffee last year. In addition, both of them also have unique insights on packaging, and have their own brand visual assets. For example, the food geometric packaging of Baicao won the gold award of Pentawards in 2018, and PepsiCo has also won many Pentawards awards.
Pakweed “Food Geometry” packaging won the 2018 Pentawards Gold Award
2. How will the operation of Baicao be managed after the transaction?
After the transaction, Baicao will serve as an independently operated business unit of PepsiCo in the Asia-Pacific region, with independent brands operating independently. Baicao will continue to accelerate its growth under the leadership of Chairman Qiu Haoqun.
At the same time, it also means that Baicao will retain its advantages as an internet company’s asset-light, fast decision-making, and flexible response.