PepsiCo announced on Tuesday that it will acquire Garza Food Ventures, the parent company of Siete Foods, for $1.2 billion. This move aims to strengthen PepsiCo’s snack offerings as there is a growing trend among cost-conscious consumers towards private-label brands.
Siete Foods, which is supported by actress Eva Longoria, is well-known for its grain-free tortilla chips and taco shells, and also produces items like enchilada sauce and Mexican wedding cookies.
Their products are available in around 40,000 retail locations throughout the United States, including stores like Target and Whole Foods.
Founded in 2014 by Veronica Garza, this Texas-based company is operated by seven members of the Garza family.
The shift towards affordable private-label brands has increased as consumers seek more budget-friendly options amid price hikes from packaged food manufacturers due to rising input costs. The packaged food sector has seen active deal-making, exemplified by the recent $36 billion acquisition of Pringles manufacturer Kellanova by Mars, the maker of Snickers.
PepsiCo is actively working to diversify its product offerings and price points, aiming to introduce new flavors for popular snack brands such as Lay’s, Doritos, and Cheetos to enhance their market appeal.
In its most recent quarter ending in July, PepsiCo reported a 4% decline in its North American snack business. The company is set to release its third-quarter earnings next week.
The acquisition is anticipated to finalize in the first half of 2025.
The Wall Street Journal first revealed on Monday that PepsiCo was in advanced discussions regarding the purchase of Siete Foods.
PepsiCo’s division, Frito-Lay North America, which specializes in convenient foods, is based in Plano.