CHINA – PepsiCo has entered into a definitive agreement to acquire Hangzhou Haomusi Food, also known as Be & Cheery, one of the largest online snacks companies in China, for US$705 million.
The New York-based company will buy Be & Cheery from Haoxiangni Health Food as part of PepsiCo’s strategy to become China’s leading consumer-centric food and beverage company after nearly four decades of operations in the Asian country.
Headquartered in Hangzhou, Be & Cheery offers a broad product portfolio across nuts, dried fruits, meat snacks, baked goods and confectionery, and predominantly sells online through the major e-commerce platforms in China.
Ram Krishnan, CEO of PepsiCo Greater China noted that Be & Cheery is highly complementary to the PepsiCo’s existing China business citing the retailer’s broad product portfolio, asset light model, and focus on e-commerce.
As one of the leading online snacks retailers, Be & Cheery has been operating a strong data-led innovation capability and flexible manufacturing and sourcing enabling it to quickly adjust its product portfolio to respond to changing consumer trends.
Krishnan said that post acquisition, PepsiCo expects to leverage Be & Cheery’s innovation and consumer insights capabilities to drive innovation in other key PepsiCo growth markets.
“As we look to accelerate growth in key markets around the world and further grow ‘in China, for China, with China’, Be & Cheery adds direct-to-consumer capability, positioning us to capitalize on continued growth in e-commerce, and a local brand that is able to stretch across a broad portfolio of products, through both online and offline channels,” Krishnan said.
Commenting on the deal, Jubin Shi, Chairman of Haoxiangni, said: “We are pleased to reach the agreement with PepsiCo.
PepsiCo is a global leading food and beverage company with deep roots in China, and with its extensive route-to-market and innovation capabilities, PepsiCo can continue to further advance Be & Cheery’s growth.”
Shi added that the divestiture of Be & Cheery will also enable Haoxiangni to focus on developing red dates and local specialty agricultural products in the future.
“We aim to expand our value chain and supply chain, in the purpose of supporting rural revitalization and achieving win-win outcomes for all,” Shi said.
The Chairman of Be & Cheery, Haoqun Qiu, commented, “We are thrilled to be joining the PepsiCo family. We believe PepsiCo’s strong branding and route-to-market capabilities as well as global supply chain network will help us deliver and expand on that mission.
“PepsiCo and Be & Cheery are jointly confident in the prospects for China’s snacks industry and share a commitment to invest in consumer-led and digitalized capabilities.
“We are excited to join forces with them as we look to expand our reach and grow Be & Cheery to the next level.”
The transaction is subject to a Haoxiangni shareholder vote, certain regulatory approvals and other customary conditions.