June 9, 2007

ST. PETERSBURG, Russia, June 9 /PRNewswire-FirstCall/ -- PepsiCo International is pleased to announce the selection of the town of Azov in the Rostov region as the planned location of its second snacks manufacturing site in Russia, paving the way for an investment of around $170 million over the next five years into the region and the creation of approximately 1000 new jobs.

PepsiCo's decision to build a second snacks manufacturing site comes five years following the decision to invest over $160 million in its first site and related agricultural programmes in Kashira near Moscow in 2002. The Kashira plant is now one of the largest and most modern snack manufacturing sites both in Russia and continental Europe.

Since 2002, the market for PepsiCo snacks products has grown quickly and the plant at Kashira, which employs around 1600 workers from the area, is now at full capacity. The new facility in Rostov will provide opportunity for the company to expand sales throughout Russia.

Rostov was chosen as the ideal location for the second site due to its optimal access to customer distribution as well as availability of land and utility connections.

PepsiCo's investment planned for Rostov will also include investments in agricultural programmes in the area which will provide local potato farmers with the tools and training to increase yields and grow superior quality potatoes. Since beginning its snacks business in Russia in 2002, PepsiCo has invested substantially in local farming with the result that only four years after the start of the programme, 80% of all potatoes used by the Kashira plant are sourced locally, with plans to reach 100% in the next few years.

Speaking in St. Petersburg at a formal signing of the letter of intent with Governor Vladimir Chub of Rostov, Michael White, Vice Chairman of PepsiCo and CEO of PepsiCo International, said: "I am delighted to confirm our decision to invest in the Rostov region to build our second snacks manufacturing site in Russia. Governor Chub and his team have provided every assistance to us in finding the best possible site and ensuring we will have access to the necessary infrastructure. We are deeply proud of our business presence in Russia and today's decision is another vote of confidence from PepsiCo in the future growth and competitiveness of the Russian economy."

PepsiCo Russia Snacks General Manager, Paul Kiesler, said: "Our business in Russia has been growing quickly and the second site in Rostov will provide us with the necessary manufacturing capability to meet growing consumer demand for our products, both today and tomorrow."

PepsiCo's beverage operations in Russia began in 1974, with the opening of a bottling plant in Novorossyisk, which established Pepsi-Cola as the first Western branded consumer product to be produced in the country. Today, PepsiCo and its strategic bottling and distribution partner, The Pepsi Bottling Group, provide direct and indirect employment for over 20,000 people in Russia and their products can be found in 96% of retail outlets across the country. PepsiCo's beverage brands in Russia include Pepsi-Cola, Aqua Minerale, Tropicana, 7UP, Mirinda and Gatorade (sports drinks). Its snacks brands include Lay's, Cheetos and Hrusteam, a recently-launched bread snack.

PepsiCo (NYSE: PEP) is one of the world's largest food and beverage companies, with 2006 annual revenues of more than $35 billion. The company operates in nearly 200 countries, and employs more than 168,000 people worldwide. Its principal businesses include: Frito-Lay snacks, Pepsi-Cola beverages, Gatorade sports drinks, Tropicana juices and Quaker foods. The PepsiCo portfolio includes 17 brands that generate $1 billion or more each in annual retail sales. PepsiCo's commitment to sustainable growth, defined as Performance with Purpose, is focused on generating healthy financial returns while giving back to communities the company serves. This includes meeting consumer needs for a spectrum of convenient foods and beverages, replenishing the environment through water, energy and packaging initiatives, and supporting its employees through a diverse and inclusive environment that recruits and retains world-class talent. The company is listed on the Dow Jones North America Sustainability Index. For more information, please visit www.pepsico.com.