LITTLE ROCK — The University of Arkansas is finalizing a deal that would make PepsiCo the university's exclusive non-alcoholic cold beverage sponsor and provider, UA officials said Thursday.
LITTLE ROCK — The University of Arkansas is finalizing a deal that would make PepsiCo the university’s exclusive non-alcoholic cold beverage sponsor and provider, UA officials said Thursday.
The planned deal would end the university’s relationship with Coca-Cola, which dates back at least 40 years, said John Diamond, associate vice chancellor of university relations.
The proposed agreement PepsiCo would cover 10 years and would begin July 1, with PepsiCo products replacing Coca-Cola products throughout the campus, in all campus soft drink fountains and at athletic events.
The amount of the contract was estimated at $19.8 million, the value projected in December when the university issued its request for proposals.
Donald O. Pederson, UA’s vice president for finance and administration, said the total value of the contract would be the largest beverage sponsorship ever at the university. The previous record was the current 10 year contract now ending with Coca-Cola valued at $10 million.
“The combination of resources the university will receive as a result of this partnership will benefit our students and campus community for years to come,” Pederson said.
Under the proposed agreement, about $7.7 million would go to academic sponsorship, licensing and vending support, and $11.2 would go to athletic marketing and sponsorship.
“The academic and student support is everything outside athletics,” Diamond said.
The agreement also would appropriate $400,000 to products for athletics and $400,000 to products for academics.
“That would be PepsiCo beverages, merchandise, other things that they would make available for student organizations or for athletics to use as giveaways for events that they are sponsoring,” Diamond said.
PepsiCo products include Pepsi, Mountain Dew, Sierra Mist, Lipton iced teas, SoBe, Aquafina, Tropicana and Gatorade. In addition, Rockstar Energy Drink, Muscle Milk and fountain-dispensed Dr. Pepper, which are distributed in the region by PepsiCo, also will be available on campus.
State lawmakers last year debated the practice by state colleges and universities of hiring vendors under contracts that include money and other perks for the schools.
The discussion came after University of Central Arkansas Board of Trustees voted in September to buy out the contract of then-UCA President Allen Meadors. The board said Meadors had misrepresented as a “gift” food vendor Aramark’s offer of $700,000 toward renovations at the president’s residence in exchange for renewal of a food service contract with the university.
Officials from a number of state colleges and universities later told the Higher Education Subcommittee of the Arkansas Legislative Council that such arrangements with vendors are not uncommon.
UCA President Tom Courtway, who at the time was serving as the school’s interim leader, said the university entered into a vendor contract with PepsiCo in 2003 for about $2 million, with an initial $500,000 payment going straight to the university and annual payments of $50,000. Pepsi also was allowed to place vending machines throughout the campus.
Courtway said much of the money received from Pepsi went to construction of a new athletic practice facility.
Officials with UA-Fayetteville, Henderson State University, Arkansas Tech, the University of Arkansas at Little Rock and other state universities also discussed similar contracts they have with vendors.