June 24, 2009 / 11:42 AM / in 10 years

UPDATE 1-PepsiCo and Calbee form food deal in Japan

* Pepsi to have a seat on Calbee board

* Pepsi shares up 1.4 pct in thin premarket trade.

NEW YORK, June 24 (Reuters) - PepsiCo Inc PEP.N plan an alliance with Japan’s Calbee Foods Co to make and sell food items such as potato chips and prawn crackers in Japan, Pepsi said on Wednesday.

Pepsi plans to “contribute” its Frito-Lay Japan business and a certain amount of cash to Calbee, but did not disclose the amount.

Calbee will issue new stock to Pepsi, which will own 20 percent of the new venture and get a seat on Calbee’s board, the snack and soft drinks maker said in a statement.

The new company will sell brands such as Calbee potato chips, Kappa Ebisen prawn crackers, Cheetos corn snacks, and breakfast cereal and vegetable snacks.

The agreement is subject to Japanese government approval.

Pepsi shares rose 74 cents to $53.75 in thin premarket trading. (Reporting by Aarthi Sivaraman; Editing by Derek Caney)

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