FIPB defers PepsiCo share dilution plea

The fate of cola giant PepsiCo’s request for exemption from the mandatory divestment of 49 per cent in its India operations has been kept hanging with the Foreign Investment Promotion Board (FIPB) deferring the proposal on Friday. In 1997, Pepsi had made a commitment that it would divest a 49 per cent stake in its Indian operations to domestic shareholders in five years.

“The condition was imposed on the company by the Ministry of Food Processing and any decision on a waiver could be taken with its consent. As representatives of the ministry were not present, the decision was deferred by FIPB,” sources said. The five-year period has passed and the company has now requested the government to withdraw the condition as at present 100 per cent FDI is allowed in food processing.