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PepsiCo raises estimate of Quaker merger synergies

AUGUST 13, 2001?PepsiCo, Purchase, NY, has raised to $400 million its estimate of annual synergies to be achieved by 2005 from its recently completed merger with The Quaker Oats Co, Chicago. This is $170 million more than PepsiCo?s original estimate of $230 million. Between $140 million and $175 million of the synergies are anticipated by the end of 2002. PepsiCo?s acquisition of Quaker Oats, which closed August 2, created a $25-billion food and beverage company, making it the fifth largest in the nation.

For Quaker Foods North America, the company is targeting volume growth of 1-2 percent and revenue growth of 2-3 percent for 2002-2005. Overall company revenues are expected to increase more than 7 percent, and operating profits, 11 to 12 percent--raising the bottom and top of the range by one percentage point from before the merger announcement.

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