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This excerpt taken from the PBG 8-K filed Jun 3, 2009. Art Barry
-
Loomis, Sayles & Company - Analyst
Good morning. Art
Barry from Loomis Sayles. Why don't you -- what do you think about asking Pepsi
for 100% stock because Pepsi itself is trading at the lowest multiple in 15
years? So as a Pepsi Bottling shareholder I would benefit from some of the
upside there.
FINAL
TRANSCRIPT
Number two I am a
big believer in DCFs and the problem I have doing a DCF with a bottler is the
CAPM implies that your discount rate is actually even lower than Pepsi's itself.
So what would you suggest is your weighted average cost of capital? What
discount rate do you think that we should use when we are building our model to
determine the value of Pepsi Bottling Group?
Al Drewes
-
Pepsi Bottling Group, Inc. - SVP & CFO
Typically on the
WACC typically we have talked about a number around 7.5% and that is a
calculated WACC that we come up with. I think some of the sell side folks do it
a little differently and may come up with different numbers, but that is what we
would use.
Eric Foss
-
Pepsi Bottling Group, Inc. - Chairman & CEO
And, Art, on the
first question I think we are not going to comment on the structure of the deal
proposal or any comments on any discussions or negotiations relative to
PepsiCo.
Mary Winn Settino
-
Pepsi Bottling Group, Inc. - VP, IR and Public Relations
Operator, we will
take the next question.
Operator
Mario
Montoya.
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