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PepsiCo CFO Downplays Potential Benefits of Spinoff

PepsiCo CFO Downplays Potential Benefits of Spinoff

The chief financial officer of PepsiCo spoke recently to CNBC following the announcement of the company's third-quarter results and put to rest the notion that the consumer product manufacturer would seek a spinoff.

According to CFO Hugh Johnston, PepsiCo would not benefit from pursuing a spinoff of a portion of its business.

"In all candor, I don't really see a lot of value in the idea," Johnston explained. "The benefits to me are completely unclear; (PepsiCo) looked at it and just frankly, (we) don't see a lot of merit in the idea."

Chief executive officer Indra Nooyi agreed with Johnston's assessment, saying in a conference call that splitting the company's business would not viably offset the increased operating costs that would follow.

Bloomberg reports that the company reported a 4.1 percent increase in third-quarter sales, largely due to raised prices and sales in Latin America. Specifically, volume in the food business in Latin America grew 3.5 percent, with markets such as Mexico and Brazil leading the way, the news source said.