Pepsico Agrees to Buy Kentucky Fried Chicken

Pepsico Inc. announced today that it has reached an agreement in principle to purchase Kentucky Fried Chicken Corp. from RJR Nabisco Inc. for about $850 million in cash.

Kentucky Fried Chicken is the second largest restaurant chain in the world--after McDonald’s Corp.--with its 6,500 franchised and company-owned restaurants.

Pepsico already operates Pizza Hut and Taco Bell restaurants, in addition to its Pepsi-Cola soft drink and Frito-Lay snack foods businesses.

The combination would create the world’s largest restaurant group, with more than 14,000 restaurants.

Pepsico is the No. 2 soft drink maker behind Coca-Cola Co.