2.2.0.7falseRestructuring, Impairment and Integration Charges118 - Disclosure - Restructuring, Impairment and Integration Chargestruefalsefalsefalse1USDfalsefalseiso4217_USDStandardhttp://www.xbrl.org/2003/iso4217USDiso42170iso4217_USD_per_sharesDividehttp://www.xbrl.org/2003/iso4217USDiso4217http://www.xbrl.org/2003/instanceshares0$53pep_RestructuringImpairmentAndIntegrationChargesDisclosureTextBlockpepfalsenadurationRestructuring, Impairment and Integration Charges Disclosurefalsefalsefalsefalsefalsefalsefalsefalsefalsefalsefalsefalse1falsefalsefalsefalse00<div>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px"><font style="FONT-FAMILY: Times New Roman" size="3"><b>Restructuring,
Impairment and Integration Charges</b></font></p>
<p style="BORDER-BOTTOM: #000000 1pt solid; LINE-HEIGHT: 1px; MARGIN-TOP: 0px; MARGIN-BOTTOM: 2px">
 </p>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px" align="justify">
<font style="FONT-FAMILY: Times New Roman" size="3">In the 12 weeks
ended June 12, 2010, we incurred merger and integration
charges of $155 million related to our acquisitions of PBG and PAS,
including $103 million recorded in the PAB segment, $28 million
recorded in the Europe segment and $24 million recorded in
corporate unallocated expenses. In the 24 weeks ended June 12,
2010, we incurred merger and integration charges of $467 million
related to our acquisitions of PBG and PAS, including $296 million
recorded in the PAB segment, $29 million recorded in the Europe
segment, $112 million recorded in corporate unallocated expenses
and $30 million recorded in interest expense. All of these charges,
other than the interest expense portion, were recorded in selling,
general and administrative expenses. These charges are being
incurred to help create a more fully integrated supply chain and
go-to-market business model, to improve the effectiveness and
efficiency of the distribution of our brands and to enhance our
revenue growth. These charges also include closing costs, one-time
financing costs and advisory fees related to our acquisitions of
PBG and PAS. In addition, in the first quarter of 2010, we recorded
$9 million of charges, representing our share of the respective
merger costs of PBG and PAS, in bottling equity income.
Substantially all cash payments related to the above charges are
expected to be paid by the end of 2011. In total, these charges had
an after-tax impact of $119 million ($0.07 per share) and $380
million ($0.23 per share) for the 12 and 24 weeks ended
June 12, 2010, respectively. In the second half of 2009, we
incurred $50 million of charges related to the merger of PBG and
PAS, of which substantially all was paid in 2009.</font></p>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px" align="justify">
<font style="FONT-FAMILY: Times New Roman" size="3">In the 12 and
24 weeks ended June 13, 2009, we incurred charges of $11
million ($10 million after-tax or $0.01 per share) and $36 million
($29 million after-tax or $0.02 per share), respectively, in
conjunction with our Productivity for Growth program. Our
Productivity for Growth program was completed in the first half of
2009. These charges were recorded in selling, general and
administrative expenses. The program included actions in all
divisions of the business, including the closure of six plants that
we believe will increase cost competitiveness across the supply
chain, upgrade and streamline our product portfolio, and simplify
the organization for more effective and timely decision-making.
Substantially all cash payments related to these charges are
expected to be paid by the end of 2010.</font></p>
<p style="MARGIN-TOP: 12px; MARGIN-BOTTOM: 0px" align="justify">
<font style="FONT-FAMILY: Times New Roman" size="3">A summary of
our merger and integration activity in 2010 is as
follows:</font></p>
<p style="MARGIN-TOP: 0px; MARGIN-BOTTOM: 0px; FONT-SIZE: 12px">
 </p>
<table border="0" cellspacing="0" cellpadding="0" width="100%" align="center">
<tr>
<td width="52%"></td>
<td valign="bottom" width="10%"></td>
<td></td>
<td></td>
<td></td>
<td valign="bottom" width="10%"></td>
<td></td>
<td></td>
<td></td>
<td valign="bottom" width="10%"></td>
<td></td>
<td></td>
<td></td>
<td valign="bottom" width="10%"></td>
<td></td>
<td></td>
<td></td>
</tr>
<tr>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font size="1">  </font></td>
<td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="3">Severance and Other<br />
Employee  Costs</font><font style="FONT-FAMILY: Times New Roman" size="1"><sup style="POSITION: relative; BOTTOM: 0.8ex; VERTICAL-ALIGN: baseline">(a)</sup></font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="3">Asset<br />
Impairment</font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="3">Other Costs</font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td style="BORDER-BOTTOM: #000000 1px solid" valign="bottom" colspan="2" align="center"><font style="FONT-FAMILY: Times New Roman" size="3">Total</font></td>
<td valign="bottom"><font size="1"> </font></td>
</tr>
<tr bgcolor="#CCEEFF">
<td valign="top">
<p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="3">2010 merger and integration
charges</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="3">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="3">185</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="3">  </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="3">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="3">113</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="3">  </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="3">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="3">178</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="3">  </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="3">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="3">476</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="3">  </font></td>
</tr>
<tr>
<td valign="top">
<p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="3">Cash payments</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="3"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="3">(32</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="3">) </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="3"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="3">–</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="3">  </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="3"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="3">(177</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="3">) </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="3"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="3">(209</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="3">) </font></td>
</tr>
<tr bgcolor="#CCEEFF">
<td valign="top">
<p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="3">Non-cash charges</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="3"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="3">(59</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="3">) </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="3"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="3">(113</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="3">) </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="3"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="3">13</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="3">  </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="3"> </font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="3">(159</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="3">) </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td> </td>
<td valign="bottom"> </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td> </td>
<td valign="bottom"> </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td> </td>
<td valign="bottom"> </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 1px solid" valign="bottom">
 </td>
<td> </td>
</tr>
<tr>
<td valign="top">
<p style="TEXT-INDENT: -1em; MARGIN-LEFT: 1em"><font style="FONT-FAMILY: Times New Roman" size="3">Liability as of
June 12, 2010</font></p>
</td>
<td valign="bottom"><font size="1">  </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="3">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="3">94</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="3">  </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="3">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="3">–</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="3">  </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="3">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="3">14</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="3">  </font></td>
<td valign="bottom"><font size="1"> </font></td>
<td valign="bottom"><font style="FONT-FAMILY: Times New Roman" size="3">$</font></td>
<td valign="bottom" align="right"><font style="FONT-FAMILY: Times New Roman" size="3">108</font></td>
<td valign="bottom" nowrap="nowrap"><font style="FONT-FAMILY: Times New Roman" size="3">  </font></td>
</tr>
<tr style="FONT-SIZE: 1px">
<td valign="bottom"></td>
<td valign="bottom">  </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td> </td>
<td valign="bottom"> </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td> </td>
<td valign="bottom"> </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td> </td>
<td valign="bottom"> </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td style="BORDER-TOP: #000000 3px double" valign="bottom">
 </td>
<td> </td>
</tr>
</table>
<p style="MARGIN-TOP: 0px; MARGIN-BOTTOM: 0px; FONT-SIZE: 6px">
 </p>
<table style="BORDER-COLLAPSE: collapse" border="0" cellspacing="0" cellpadding="0" width="100%">
<tr>
<td valign="top" width="5%" align="left"><font style="FONT-FAMILY: Times New Roman" size="1"><sup style="POSITION: relative; BOTTOM: 0.8ex; VERTICAL-ALIGN: baseline">(a)</sup></font></td>
<td valign="top" align="left"><font style="FONT-FAMILY: Times New Roman" size="3">Primarily reflects
termination costs for approximately 990 employees.</font></td>
</tr>
</table>
</div>Restructuring,
Impairment and Integration Charges
 
In the 12 weeks
ended June 12, 2010, we incurred merger and integration
charges of $155 millionfalsefalsefalseus-types:textBlockItemTypetextblockRestructuring, Impairment and Integration Charges DisclosureNo authoritative reference available.false11falseUnKnownUnKnownUnKnownfalsetrue
