Patties of Beyond Meat Inc.’s Beyond Burger Vegetable Burgers they are cooked in a pan.
Yuriko Nakao | Getty Images
Beyond Meat and PepsiCo announced on Tuesday that they have set up a joint venture to create, produce and market snacks and beverages with vegetable substitutes.
Shares of Beyond jumped up 16% in premarket trading on the news, while shares of Pepsi rose 1%.
The association gives Beyond, a newcomer to the food world, the opportunity to take advantage of Pepsi’s experience in the production and marketing of new products. For its part, Pepsi can deepen investment in increasingly popular plant categories, while working with one of the leading creators of meat substitutes.
Beyond Meat controls about 13% of the meat alternatives category in the U.S., according to Jefferies estimates.
“PepsiCo represents the ideal partner for us in this exciting, far-reaching, global effort,” Ethan Brown, CEO of Beyond Meat, said in a statement.
The operations will be managed through a limited liability corporation called The PLANeT Partnership. Financial conditions were not disclosed.
The partnership also helps Pepsi achieve its sustainability goals. Last year, the company signed the United Nations commitment and pledged to set science-based emission reduction targets. A 2019 UN report found that the food system contributes 37% of greenhouse gas emissions. In recent years, Pepsi has also been trying to reduce the amount of sugar in its products and add healthier snacks and drinks to its portfolio.
PepsiCo’s shares are nearly flat over the past year, giving it a market value of $ 196 billion. The food and beverage giant has seen more sales during the pandemic, thanks to consumer storage and less occasional exposure away from home than its rival Coca-Cola.
At the close on Monday, Beyond shares have risen more than 32% in the past year, despite the blow its business suffered from the coronavirus pandemic, which hurt its restaurant sales. The company has a market value of $ 9.952 billion.