PepsiCo partners Beyond Meat to develop and sell snacks and beverages made from plant-based protein, sending shares of Beyond Meat to an 18-month high, as much as 39% to USD221.
In recent years, plant-based meat alternatives, such as burger patties and sausages have gained in popularity as curious health-conscious consumers look to broaden or shift from chicken, pork and beef-based diets.
Beyond Meat burger patties and sausages have been among the leaders in the surge in interest in plant-based alternatives over the past two years, as consumers worried about their health, animal welfare and food safety.
However, the company suffered a surprise loss in its last reported quarter as demand for its products at restaurants and grocery stores tapered after an initial surge at the start of the coronavirus pandemic.
The joint-venture with PepsiCo was the latest in a run of marketing successes for Beyond which include a distribution deal with Walmart, and partnerships with restaurants including Taco Bell, KFC and Starbucks.
According to Beyond Meat Chief Executive Officer Ethan Brown, this new partnership with the beverage giant will give the faux meat maker access to PepsiCo’s distribution and marketing resources and allow it to expand into new product lines,
PepsiCo, which apart from its namesake soda owns the Lays, Quaker and Gatorade brands, has also been looking to expand its portfolio of health-focused snacks and beverages.
In a statement, Ram Krishnan, PepsiCo global chief commercial officer, said that plant-based proteins represent an exciting growth opportunity for them, a new frontier in their efforts to build a more sustainable food system.
However, Beyond Meat could not provide the financial terms of the partnership. The operations will be managed through a newly created entity, PLANeT Partnership LLC.
According to JP Morgan analysts, any time a relatively small company can partner in any way with a global behemoth like PEP, it’s usually good news, but questioned the true benefit of the deal.
Is there a huge, uncounted population clamouring for vegan Doritos? Probably not, in their opinion, and surely not big enough to justify this kind of stock move.