The US cereal and soft drinks group, Quaker Oats, has rejected a $13 billion takeover offer from PepsiCo at a meeting between the two companies yesterday. The company had offered around two of its shares for each Quaker share, thus valuing the company at around $100 per share.
PepsiCo, which has been moving to group itself as a beverages and foods company, has been interested in Quaker because of its successful Gatorade sports drink, which has an 80-per-cent market share in the country. PepsiCo's own sports drink brand, Allsport, has seen its market share decline while Coke's Powerade has gained ground over the past two years.
Quaker, which, despite being one of the best performers in the US food industry, has shown all signs of being able to continue for long as an independent company, has been in the centre of the consolidation process of the US foods industry.
Apart from PepsiCo, other consumer companies, including Danone, the French group, and Nestle, the Swiss chocolate giant, are also thought to have expressed interest in Quaker.
The industry in the US has seen a flurry of consolidation in the US food industry this year, including Unilever's takeover of Bestfoods, Kraft's acquisition of biscuit maker Nabisco, the purchase of Pillsbury by General Mills and the recently concluded deal in which Kellogg snapped up Keebler.