KFC Picks Coca-Cola for Thousands of U.S. Restaurants, Threatening $50 Million to PepsiCo
Updated
Updated · Yahoo Finance · Oct 16
KFC Picks Coca-Cola for Thousands of U.S. Restaurants, Threatening $50 Million to PepsiCo
3 articles · Updated · Yahoo Finance · Oct 16
Summary
KFC has struck a deal to make Coca-Cola the beverage supplier for thousands of U.S. restaurants, with the switch set to begin in January while PepsiCo keeps the international business.
The loss breaks a decades-long tie between PepsiCo and the Yum! Brands chain, which was spun out of PepsiCo in 1997 with KFC, Pizza Hut and Taco Bell.
Evercore ISI said Coca-Cola’s stronger brand equity helped win the account and estimated PepsiCo could lose about $50 million in revenue, implying roughly $350 million to $400 million in retail sales.
The setback adds to a difficult year for PepsiCo, whose stock is down by a double-digit percentage and which already lost Marriott’s beverage business to Coca-Cola in April.