PepsiCo is extending its reach in Africa with the $1.7 billion acquisition of Pioneer Foods, a packaged goods business based in South Africa.

The deal grants PepsiCo access to a “robust, locally relevant” product portfolio comprising cereals, juices and other African nutritional food staples.

The company added that the deal helps it gain a “solid beachhead” for expansion into sub-Saharan Africa by boosting its manufacturing and go-to-market capabilities, enable scale and distribution.

“Pioneer Foods represents a differentiated opportunity for PepsiCo and allows us to immediately scale our business in Africa,” said PepsiCo’s Chairman and CEO, Ramon Laguarta.

The deal will see PepsiCo expand its Sustainable Farming Program in Africa through which it will work with local farmers in Pioneer Foods’ communities to help boost yields, improve livelihoods, and preserve precious natural resources.

Tertius Carstens, CEO of Pioneer Foods, said: “As part of PepsiCo, we will have greater scale to expand our leading brands, greater capital to invest in local agriculture and people, greater access to leading global capabilities and a partner committed to taking our company to even greater heights.”