Earl G. Graves Agrees To Sell Stake In D.C. Pepsi Franchise Back To Pepsi-Cola Co.; Will Assume New Role With Pepsi-Cola North America

Jet, Dec 21, 1998

Earl G. Graves, Chairman and CEO of Earl G. Graves, Ltd., the parent company of Earl G. Graves Publishing Co. (publisher of Black Enterprise magazine) and Chairman and CEO of Pepsi-Cola of Washington, D.C., L.P., has announced that he has reached an agreement in principle to sell his stake in the franchise back to the parent company.

Pepsi-Cola of Washington, D.C., L.P. was formed in July 1990. The $60-million franchise covers a territory of over 400 square miles including Washington, D.C., and Prince George's County, Maryland, and is the largest minority-controlled Pepsi-Cola franchise in the United States. The company has earned the Bottler of the Year Award for the Pepsi-Cola Company for three of the last four years.

Given the planned separation of Pepsi-Cola's bottling and concentrate entities, the proposed transaction is consistent with Pepsi-Cola Companies ongoing efforts to consolidate its bottling operations and build economies of scale nationwide.

Under his arrangement with the Pepsi-Cola Company, Graves would take on a new role as Chairman of Pepsi's Customer Advisory and Ethnic Marketing Committee. He would help Pepsi's senior management in creating business-building strategies and programs to accelerate their growth among ethnic consumers.

"My decision to sell my Pepsi franchise is undoubtedly a sound business decision," says Graves. "Not only has Pepsi made me an attractive offer, they have asked me to continue on with them as a powerful voice within the company as it relates to their national sales and marketing efforts."

Michael Graves, Earl Graves' youngest son, who currently serves as General Manager for Pepsi-Cola of Washington, D.C., would join the Pepsi-Bottling Group as unit manager for the distribution facility which would continue to serve the District of Columbia and Prince George's County.

"We are pleased that Earl's enormous talent and expertise is available to us on a national level as we expand our marketing and sales initiatives toward this vital, rapidly growing segment of our business," says Phil Marineau, president and CEO of Pepsi-Cola North America.

"Thanks to Earl and his son Michael's leadership in growing this franchise and forging strong ties to the community, this business would be a great addition to The Pepsi Bottling Group," says Craig Weatherup, Chairman and CEO of The Pepsi Bottling Group.

The transaction is expected to close before the end of the year.

Earl G Graves is a nationally-recognized authority on Black business development and the founder and publisher of Black Enterprise Magazine. He is also on the Board of Directors of several major corporations including AMR Corporation (American Airlines), Chrysler Corporation, Federated Department Stores, Aetna, Inc and Rohm & Haas Corporation.