President Nixon is known for a lot of bad things but he was one of the best presidents I've ever seen when it comes to foreign relations. He navigated our first great relationship with China and even though we had a cold war going with Russia, he created a fantastic connection with Soviet Premiere Nikita Krushchev.
Nixon helped open trade relations with Russia and one of Nixon's friends (Donald Kendall), was an executive with Pepsi and he asked Nixon to get Krushchev to try their soda and Krushchev loved it. Coca Cola was also trying to court Russia, but Pepsi ended up with exclusivity in the Russian market which began in 1974. The trade agreement dictated that the United States purchase a similar dollar amount of Stolnichnaya Vodka as they were buying of Pepsi products. The U.S. had no problem holding up their end of the bargain and it became the number one brand of vodka in our country.
Coca Cola eventually made it into Russia, but Pepsi still owns most of the market share. At this point, Pepsi-Cola Moscow, is a very large and popular employer. PepsiCo was able to survive the craziness of The Cold War and Russia’s Iron Curtain, which is amazing, but could you imagine the outrage of the citizens of Russia back then, if suddenly they couldn’t get their hands on a Pepsi? Things were bad enough over there, cutting them off from these addictive beverages could've led to a revolt.
So, what does this have to do with Pepsi having a navy? Well, Pepsi took on a lot of risks cutting trade deals with a communist country. They were the first non-government owned company in the U.S.S.R. One of the risks had to do with currency because the Russian Ruble wasn’t stable and eventually Russia owed PepsiCo a lot of money in 1989. In a crazy deal, Russia offered Pepsi a fleet of 17 obsolete Soviet Navy diesel attack submarines along with a decommissioned cruiser, destroyer, and frigate, as well as several new civilian oil tankers to pay off some debt. Just like that, PepsiCo had become the sixth largest navy in the world.
They ended up selling the oil tankers to Norway and sold the decommissioned military ships and submarines to a shipyard in Sweden where they were scrapped for metal. It was a very creative deal on both PepsiCo's and Russia's part and now their partnership is worth billions.
There are so many amazing stories around the world and we only hear or read about a fraction of them, thus one of the reasons I wanted to start a knowledge seeking blog. If you'd like to share this with anyone all you need to do is copy and paste it into your email. Take care and make it a great day!