PURCHASE, N.Y. (AP) — PepsiCo Inc. said Thursday that it received all the regulatory and shareholder approval it needs to secure a stake in Chinese drinks maker Tingyi Holding Corp.
The U.S. beverage and food company, based in Purchase, N.Y., said in November that it planned to swap its holdings in its mainland China bottling operations for a stake in Tingyi to beef up its distribution in the fast-growing Chinese market.
PepsiCo transferred its interests in its bottling operations in China to Tingyi-Asahi Beverages Holding Co., acquiring in return a 5 percent indirect stake in Tingyi's drinks subsidiary. PepsiCo has the option to increase that stake to 20 percent by 2015.
Taiwan-based Tingyi is one of China's leading food and drinks makers.
PepsiCo, like many food, beverage and consumer product companies, wants to better position itself in China and other emerging markets to access the rising middle class there. The company estimates China will become the world's largest drinks market by 2015.
The transaction was approved by Tingyi shareholders in February. PepsiCo and Tingyi said they hope to close the deal as soon as possible.
Both companies expect the deal will boost Tingyi's product offerings and help PepsiCo as it seeks an edge over rival Coca-Cola Co.
Pepsi announced in 2010 that it would invest $2.5 billion in its China business over the next few years after a $1 billion investment announced in 2008.
Coca-Cola also says China is one of its fastest-growing markets, with sales volume up 13 percent there last year. It opened its 42nd bottling plant in China on Thursday.
Shares of PepsiCo rose 9 cents to close at $66.02 Thursday. Coca-Cola's shares rose $1.15 to close at $73.81.