Strauss Takes Controlling Stake in PepsiCo Snack Venture After 35 Years
Strauss Group is taking a controlling 50.1% stake in its salty snack joint venture with PepsiCo after acquiring an additional share. The move follows PepsiCo's earlier exit from the Sabra dip partnership.
PepsiCo is restructuring its joint venture in Israel, with the U.S. food giant selling a stake that will make Strauss Group the controlling shareholder of their joint salty snack venture after three and a half decades of equal partnership.
Strauss announced that it will exercise an option to acquire an additional 0.1% stake in PepsiCo's Frito-Lay joint venture for $396,000, raising its holdings to 50.1%. As a result, Strauss will consolidate Frito-Lay's financial results into its balance sheet for the first time starting from the completion quarter, and expects to record a one-time accounting capital gain of approximately 630 to 650 million shekels.
The transaction follows a previous agreement signed in November 2024, in which PepsiCo acquired Strauss's 50% stake in the Sabra and Obela dip ventures for roughly $240 million. Under that agreement, Strauss received an option to purchase up to 2.5% of Frito-Lay shares for up to $9.9 million, reflecting a total valuation of about $396 million for the snack unit.
Following the acquisition of control, the shareholders' agreement will be amended to grant Strauss a majority of voting rights on the board of directors and the authority to appoint the CEO, subject to limited veto rights by PepsiCo. The local snack business, known for producing popular brands like Tapuchips, Doritos, and Cheetos at its Sderot manufacturing plant, operates using technical expertise licensed from PepsiCo. In 2024 and 2025, Strauss Frito-Lay paid PepsiCo royalties amounting to approximately 10.5 million shekels and 10 million shekels respectively.
