Moody's upgrades PepsiCo

Moody's Investors Service said it upgraded the debt of Pepsi Bottling Group, Bottling Group LLC to Aa3 from A2 and of Pepsi Americas to Aa3 from Baa1 following PepsiCo's announcement that it has unconditionally and irrevocably guaranteed the debt of its bottlers.

The outlook is stable. This concludes the review begun in April 2009 when PepsiCo first announced that it would acquire the bottlers but had not yet determined what sort of support would be provided.

The Aa3 long-term rating reflects the strong brand franchises in snack foods and beverages, global reach, solid innovation pipelines, efficient operations, and extensive and multifaceted distribution network, as well as its good liquidity and continued solid financial performance, offset by higher leverage after the bottler acquisitions, according to the agency.

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