PepsiCo is getting out of the U.S. yogurt business less than four years after entering it. The food and beverage giant confirmed in a statement today that it was exiting a joint venture with the Theo Muller Group that in 2012 led to the launch of a yogurt brand co-branded with the Muller and Quaker names. PepsiCo owns Quaker.
"After determining that the business was not meeting expectations in a competitive and dynamic marketplace, it was mutually agreed by PepsiCo and the Theo Muller Group to be in our best interests to exit the joint venture," PepsiCo said in a statement.
A plant in New York where the yogurt was made has been purchased by a cooperative called Dairy Farmers of America. PepsiCo stated that "we are also pleased to know that DFA, the nation's leading milk marketing cooperative, with nearly 1,400 member farms in New York alone, intends to continue to invest in the community and further expand their production and agricultural presence in the state."
The Associated Press reported on the plant sale on Thursday, noting that "the $208 million yogurt plant was opened in the spring of 2013 with about $14 million in state tax credits."
PepsiCo continues to operate in the dairy category in several overseas markets including Russia, Brazil and the Middle East. A spokeswoman noted that the company recently launched a Quaker-branded high fiber oat drink with dairy in China.
But the highly competitive U.S. yogurt market apparently proved to be too tough for PepsiCo. The marketer held just 2.2% share of the yogurt market this year, which is flat from 2014, according Euromonitor International. Market leaders include Dannon, General Mills and Chobani. PepsiCo launched Muller Quaker in 2012 with a campaign by Omnicom Group's Juniper Park that used the tagline "The European for Yummy."