Boston, MA 08/26/2014 (wallstreetpr) – PepsiCo, Inc. (NYSE:PEP)‘s Chairman and CEO, Indra Nooyi, is in a visit to India, and she has already held talks with the country’s Commerce and Industry Minister, Nirmala Sitharaman. However, no details have been provided about the agenda of the meeting. Besides the Minister of Commerce and Industries, Nooyi will also meet other top government officials including Prime Minister Narendra Modi.
The beverage and snacks company ranks India among its top markets. It has invested more than $2 billion in the country so far since its entry into the market back in 1989. The company has plans to boost its capacity in areas such as innovation, infrastructure and manufacturing in India. That is why Nooyi’s visit remains a closely tracked event.
Jostling for India?
As a matter of fact, various global companies have been in India in the recent times since the election of Modi as the prime minister. The other global players actively circling India include Facebook Inc (NASDAQ:FB), whose COO, Sheryl Sandberg, called on Modi.
The visiting by PepsiCo, Inc. (NYSE:PEP)’s chief to India comes at a time when shareholders are putting pressure on the company to separate its snacks and foods business from the failing beverage business. They want the snacks business to be spun off into a standalone company as they claim such a move would enhance shareholder value. Even Barron’s has added its weight to the spinoff call, citing that the snacks business is better off as a standalone company.
Snacks business spinoff
However, the management of PepsiCo, Inc. (NYSE:PEP) is openly opposed to the spinoff calls, citing that the “Power of One” approach is in the best interest of the shareholders in the long-run. The snacks segment is responsible for 68% of the total revenue and last year the segment increased sales by 4.6% at a time when the beverage segment declined 1.6%.
Investors that are calling for the spinoff of the snacks business claim that the struggling beverage segment is dragging down PepsiCo, Inc. (NYSE:PEP)’s performance. As such, they say that denies shareholders their rightful gains.
