Rotterdam-based juice and soft drink bottler Refresco has entered into a strategic agreement with food and beverage company PepsiCo to produce part of the latter’s beverages volume in Spain.

The agreement, effective from next month, will also involve the transfer of two of the three plants currently owned by PepsiCo in Spain, Tafalla (Navarra) and Seville.

Refresco Group CEO Hans Roelofs said: “This agreement is a very good extension of our relationship with one of our key customers, PepsiCo. It also confirms our business model in Spain, serving retailers and contracts manufacturing customers.”

Refresco and PepsiCo have already established their partnership in other European markets including France, Belgium and Germany. The two companies also have partnerships established in the US market as well.

The deal is expected to complement Refresco’s existing plants in the region in geographical, as well as in a technological manner.

It will enable the company to enhance its production capacity in Spain.

PepsiCo intends to follow a mixed model in the Spanish region as its third production plant, located in Echávarri Viña (Alava) and engaged in the production of carbonated beverages, will continue to be a part of PepsiCo’s operations.

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The third facility will cater to the requirements of Spain and other European markets, due to its strategic location.

PepsiCo South West Europe supply chain director Victor Perez said: “This new mixed supply model is key to our sustainable growth in the Spanish market. Refresco is a natural partner for PepsiCo as we successfully work together in other markets maintaining our high standards of quality and service.”