Pepsico to Sign Major New Pact With Soviets

The Cold War may be winding down, but the Cola War appears to be heating up on the Russian front.

Pepsico Inc., which has been selling Pepsi in the Soviet Union for more than 15 years, is scheduled to announce at a Moscow news conference scheduled for today what it describes as “the largest and most comprehensive” commercial trade deal ever signed between an American firm and the Soviet government. The current agreement between Pepsico and the Soviets expires this year.

Some analysts say the agreement is aimed at defending Pepsi’s Soviet operations against expansion plans by arch-rival Coca-Cola Co. Pepsico would not reveal details of the pact in advance the news conference.

“It may represent a counterattack to the incursions that Coca-Cola has been making,” said Gordon Feller, editor of the East/West Report, a newsletter on the Soviet and Eastern European economies. Coca-Cola, which has been selling Coke in the Soviet Union since 1987 under a six-year agreement, is believed to be conducting further negotiations with the government, Feller said.

Currently, Pepsico--which has also agreed to bring its Pizza Hut restaurant chain to the Soviet Union--sells about 40 million cases of Pepsi there annually. Lacking a convertible currency, the Soviets pay Pepsico with Stolichnaya vodka and even scrap iron from mothballed battleships.

Pepsi was first served to the Soviets in 1959 during the Moscow trade fair. It enjoyed a long monopoly as the only foreign cola sold in the Soviet Union under an agreement reached in 1972.