The FINANCIAL -- PepsiCo announced that it has signed an agreement with
Diamond Star Co., Ltd., a unit of the Capital Diamond Star Group, to
distribute PepsiCo beverage brands in Myanmar.
As part of the agreement, Diamond Star, which is one of the largest consumer packaged goods distributors in Myanmar, now has exclusive rights to import, sell and distribute Pepsi-Cola, 7-Up and Mirinda, three of the 22 brands in PepsiCo's portfolio that generate more than $1 billion each in annual retail sales.
PepsiCo also plans to explore opportunities to invest in agricultural development projects in Myanmar. One of the world's largest agricultural enterprises, PepsiCo sources more than four million tons of potatoes annually and works with thousands of local farmers around the globe to make its products.
As PepsiCo reported, the distribution agreement with Diamond Star follows several years of strong growth for PepsiCo in developing and emerging markets. PepsiCo nearly tripled its business in developing and emerging markets from $8 billion in annual revenue in 2006 to $22 billion in 2011.
In addition, PepsiCo also announced that it has signed a Memorandum of Understanding with the United Nations Educational, Scientific and Cultural Organization (UNESCO) to partner on vocational training initiatives in Myanmar. PepsiCo and UNESCO plan to work together to provide programs that focus on managerial skills training to support the country's development, empower its people and strengthen the workforce as PepsiCo looks to expand its business in the future.
"PepsiCo has a strong and growing business that spans more than 200 countries and territories around the world, and we are constantly looking for new growth opportunities that will put our food and beverage brands in the hands of more consumers," said PepsiCo Chairman and CEO Indra Nooyi. "Myanmar is a market with great potential, and our agreements with Diamond Star and UNESCO are important first steps towards expanding our presence in the country. Over time, we believe we can build a strong business in Myanmar and play a positive role in the country's continued development."
"Diamond Star is extremely proud to be associated with PepsiCo," said Diamond Star Managing Director Ko Ko Gyi. "PepsiCo is a world-class company that emphasizes an exemplary code of conduct and a sustainable approach to business with a focus on people at its center."
"Giving youth the skills they need to secure decent jobs, improve their livelihoods and shape their future is a key to successful national transformation. Private corporate partners have a determining role to play in this ambition, and UNESCO warmly welcomes this new partnership with PepsiCo to show how we can work together for the benefit of Myanmar's youth -- its most valuable resource," said Irina Bokova, Director-General of UNESCO.
Diamond Star has been doing business in Myanmar for nearly 50 years. During that time, the company has built strong distribution capabilities and relationships throughout Myanmar's retail sector. PepsiCo beverages are now available to consumers in parts of the country and product availability will increase in the coming weeks. Under the recently signed agreement, Diamond Star purchases and imports the products from PepsiCo's Vietnam operations. It plans to promote PepsiCo's brands in Myanmar with a sampling campaign and outdoor advertising.
PepsiCo last did business in Myanmar in 1997. The United States Department of State earlier this year encouraged companies to explore opportunities in the country. PepsiCo plans to evaluate other opportunities in the Myanmar market, including the potential for local manufacturing operations.