US-based beverage and snack maker PepsiCo is planning to acquire South Africa’s Pioneer Food Group for around $1.7 billion, the two companies said on Friday, as it targets expansion in Africa.

PepsiCo offered a cash consideration of R110 per Pioneer Foods ordinary share, a 56.5% premium as of July 12.

“This acquisition will help PepsiCo gain a solid beachhead for expansion into sub-Saharan Africa by boosting the company’s manufacturing and go-to-market capabilities, enabling scale and distribution,” PepsiCo said in a statement.