PepsiCo keep full ownership of local unit
2 Jan 2009, 1836 Hrs

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New Delhi, Jan 2 The government of India today allowed global snack and beverages maker PepsiCo Inc to retain full ownership of its local bottling arm, and invest up to 50 million dollars.

The decision was taken at a meeting of the cabinet presided over by Prime Minister Dr. Manmohan Singh here today.

Briefing mediapersons after the cabinet meeting, Union Minister of Science, Technology and Earth Sciences Kapil Sibal said, "The Government decided that the previous conditions of disinvestment which applied earlier should be deleted keeping in view the latest policy and latest conditions recommended by Foreign Investment Promotion Board. Under this, the Pepsico India holding private limited will bring additional equity of 50 million dollars."

At the time of Pepsi's initial investment in India, rules capped foreign holdings in the sector at 51 per cent, and approval for the venture mandated the firm sell 49 percent of its local unit within the first five years of operations.

That deadline was later extended and when rules were relaxed to allow full foreign ownership in the food processing industry, Pepsi asked the government to amend the approval and waive the stake sale condition. (ANI)