Varun Beverages to raise $85 mn from IFC

The Pepsi bottler will use the funds to support its $300-million investment plan

Varun Beverages Limited, one of the major bottling and distribution franchisees of PepsiCo, plans to invest about $300 million over the next 12 months to expand its business. Towards this, the company seeks to raise $85 million from International Finance Corporation (IFC) and a few other investors. Listing on the bourses is also on the cards.

The $300-million investment will be deployed across the firm’s existing business in India, Nepal, Sri Lanka, Morocco, Zambia and Mozambique as well as acquiring companies over the next one year.

IFC said its involvement would bring in discipline and credibility to the company as it prepares for a public listing.

According to the project document with IFC, the project will be financed through a combination of $85 million equity investment by IFC, internal accruals and additional equity and debt to be raised by the company. Varun Beverages’ currently employ strength is 4,200, which is expected to be 8,000 over the next few years as the company expands its operations in south-Asia and Africa. The firm also supports about 30,000 jobs indirectly, its business being logistics-intensive operation, generating numerous jobs for loading and unloading operations.

Promoted by RJ Corp, Varun Beverages holds bottling and distribution franchise rights from PepsiCo across India, Nepal, Sri Lanka and Africa.  In India, it manages nine PepsiCo bottling plants across India in Haryana, Uttar Pradesh, Rajasthan, north-east, Goa and Delhi national capita region.