The PepsiCo Spinoff of Yum Brands: Twenty-Year Review

Back in the 1990s, Pepsi had its hand in every cookie jar. It not only had its beverage lineup led by Pepsi, Diet Pepsi, Mountain Dew, and (before later selling it off) Schweppes, but also had branched out into food as well. In addition to the well-known Frito-Lay acquisition that turned it into a colossal source of snack profits, PepsiCo shareholders also had an entrenched interest in the fast food business, having held full ownership of KFC, Pizza Hut, and Taco Bell.

In September of 1997, Pepsi’s Board of Directors decided that it would spinoff Tricon Global Brands (YUM’s original name) with each Pepsi shareholder receiving 1 share of Tricon for every 10 shares of Pepsi owned.

What has happened to those Pepsi and Yum shares over time?

Today, each share of Pepsi has become 1.6 PEP shares with dividends reinvested for a compounding rate of 7% annualized.

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