Tingyi Holding Corp., Tianjin, China, and Purchase, N.Y-based PepsiCo Inc. announced that the two parties have completed their transaction to create a strategic beverage alliance in China. The alliance was approved by the shareholders of Tingyi in February and received regulatory approval March 29.

Tingyi beverage subsidiary Tingyi-Asahi Beverage Holding Co. Ltd. (TAB) now is PepsiCo’s franchise bottler in China. TAB will partner with PepsiCo’s current bottlers to manufacture, sell and distribute PepsiCo’s carbonated soft drink and Gatorade brands, the companies said in a statement. In addition, PepsiCo and TAB will begin co-branding their respective juice drink brands using the Tropicana brand name, which is under license from PepsiCo. The company will retain branding and marketing responsibilities for the products.

Under the terms of the alliance, PepsiCo has contributed its indirect equity interests in its company-owned and joint venture bottling operations in China to TAB and received as consideration a 5 percent indirect equity interest in TAB. PepsiCo has an option to increase its indirect holding in TAB to 20 percent at its sole discretion by 2015. The shareholdings of PepsiCo’s existing Chinese joint venture partners in the joint venture bottling operations will not change as a result of the transaction.

The alliance is expected to create long-term value for PepsiCo and Tingyi shareholders, employees and local bottling partners and also encourages the continued growth and development of China’s beverage industry, the companies said in a statement.

“China will soon surpass the United States to become the largest beverage market in the world,” PepsiCo Chairman and Chief Executive Officer Indra Nooyi said in a statement. “As a result of this new alliance with Tingyi, PepsiCo is extremely well-positioned for long-term growth in China. Tingyi is an outstanding operator with a proven track record of success. By leveraging the complementary strengths of each company, we’ll be able to significantly enhance our beverage business in China, reach millions of new consumers throughout the country, and create value for Tingyi and PepsiCo shareholders.”

The transaction involves the companies’ respective mainland China beverage operations; both PepsiCo and Tingyi will continue to independently operate their respective food businesses.