Carlsberg is expanding its long-running relationship with PepsiCo into Georgia and Armenia.

The partnership will allow Carlsberg to broaden its beverage portfolio, strengthen its regional route to market and build a larger operating platform across the South Caucasus.

Carlsberg Group is to acquire PepsiCo bottling businesses in Georgia and Armenia, extending a strategic partnership that has developed across Europe, Central Asia and Southeast Asia.

The agreements will see Carlsberg take responsibility for the production, sale and distribution of PepsiCo’s soft drinks portfolio in the two markets. The move follows the recently announced expansion into Azerbaijan, creating what Carlsberg describes as a strong South Caucasus cluster.

The development illustrates how established beverage businesses are increasingly looking beyond individual brands and markets to build multi-beverage manufacturing, distribution and route-to-market platforms.

Turning local capability into regional scale

Carlsberg has agreed to acquire Iberia Refreshments in Georgia and JI Pepsi Cola Bottler Armenia from Revery, which currently owns the two businesses and operates them as PepsiCo bottlers.

The Armenian transaction remains subject to government regulatory approval. Once the transactions are completed, Georgia and Armenia will become Carlsberg operating markets.

Carlsberg already has an established PepsiCo business in neighbouring Azerbaijan, where it is due to become PepsiCo’s bottler from January 2027. The three markets can now be developed as a South Caucasus cluster, giving Carlsberg a larger regional platform from which to manufacture, sell and distribute beverages.

This follows a broader expansion of the Carlsberg-PepsiCo relationship. Earlier this year, Carlsberg announced that it would become PepsiCo’s bottler in Denmark, Finland and the three Baltic states from 2029, taking its PepsiCo bottling agreements to 14 markets before the latest South Caucasus additions.

Following the Georgia and Armenia agreements, that footprint will rise to 17 markets.

Why the partnership works

For PepsiCo, the attraction is access to Carlsberg’s established local operating capabilities and route to market.

Natalia Filippociants, SVP and GM, Internal Beverages Europe at PepsiCo, said the expanded relationship combines PepsiCo’s portfolio with Carlsberg’s capabilities to create a stronger route to market and support the next phase of growth.

For Carlsberg, the deal strengthens its move towards a broader beverage model rather than relying solely on beer.

Nikos Kalaitzidakis, Carlsberg’s executive vice president for Central and Eastern Europe & India, said the expanded business would provide a platform to develop a full multi-beverage portfolio across the region.

That is an important part of the rationale. Carlsberg is able to add globally recognised soft drinks to its existing beer portfolio while using capabilities it already has in manufacturing, distribution, sales and customer relationships.

From brewer to multi-beverage manufacturer

The expansion is part of a wider shift in Carlsberg’s business model.

The company has been systematically increasing its exposure to soft drinks through bottling agreements with PepsiCo and other partnerships. Its management has previously highlighted the opportunity to use its route-to-market, particularly in the on-trade, to accelerate PepsiCo portfolio growth. It has also identified opportunities for cross-border production, new product launches and other scale benefits where markets can be managed as clusters.

The South Caucasus therefore provides another example of this strategy in practice.

Instead of treating Georgia, Armenia and Azerbaijan as isolated markets, Carlsberg can potentially use the combined footprint to improve coordination across production, logistics, sales and portfolio development.

That creates opportunities to spread capabilities and investment across a larger volume base while giving PepsiCo a more consistent operating partner in the region.

What it brings to the beverage operation

For Carlsberg, the immediate benefit is portfolio diversification.

PepsiCo brings an established range of soft drinks, while Carlsberg contributes local manufacturing and commercial infrastructure. The combination allows the group to participate in more beverage occasions and gives customers a broader portfolio through a single route-to-market.

The model also gives Carlsberg greater exposure to categories outside traditional beer, supporting its longer-term ambition to grow its broader beverages business.

The recent Azerbaijan agreement demonstrates the potential scale of this approach. Carlsberg is expanding its Xirdalan brewery to produce the PepsiCo portfolio, with the company expecting the PepsiCo partnership to double its business in Azerbaijan.