8-K

                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549



                                    Form 8-K

                                 CURRENT REPORT

                       Pursuant to Section 13 or 15(d) of
                       The Securities Exchange Act of 1934


                       January 26, 1999 (January 25, 1999)
                    --------------------------------------
               Date of Report (Date of earliest event reported)


                                  PepsiCo, Inc.
                   ----------------------------------------
            (Exact name of registrant as specified in its charter)

                                 North Carolina
                      ---------------------------------
                (State or other jurisdiction of incorporation)


               1-1183                              13-1584302
      (Commission File Number)         (IRS Employer Identification No.)



               700 Anderson Hill Road, Purchase, New York 10577
                 -------------------------------------------
                   (Address of Principal Executive Offices)

      Registrant's telephone number, including area code: (914) 253-2000





Item 5.            Other Events.

      The information  contained in Exhibit 20 hereto is incorporated  herein by
reference.

Item 7.     Financial Statements, Pro Forma Financial Information and
Exhibits.

            (c)   Exhibits.

            20    Press Release dated January 25, 1999 from PepsiCo, Inc.



                                   SIGNATURES

      Pursuant to the  requirements of the Securities  Exchange Act of 1934, the
registrant  has duly  caused  this  report  to be  signed  on its  behalf by the
undersigned hereunto duly authorized.

Date:  January 26, 1999                   PepsiCo, Inc.




                                    By:   /s/ LAWRENCE F. DICKIE
                                          Lawrence F. Dickie
                                          Vice President,
                                          Associate General Counsel
                                          and Assistant Secretary

EX-20

PEPSICO REACHES AGREEMENT WITH WHITMAN
CORPORATION TO FORM MASTER PEPSI BOTTLER;
PEPSICO COMMENTS ON FOURTH QUARTER RESULTS 


PURCHASE, N.Y., Jan. 25, 1999 - PepsiCo, Inc. today made several
announcements regarding a major bottling transaction and fourth-quarter
financial results.

AGREEMENT REACHED WITH WHITMAN 

PepsiCo announced that it has reached an agreement with Whitman Corporation, the
world's largest  independent Pepsi bottler,  to realign bottling  territories in
order to create a new master Pepsi-Cola bottler.

Under the terms of the agreement:

   PepsiCo will consolidate certain of its bottling territories and other
   assets with Whitman's existing bottling business to create a new and very
   powerful bottling company to be called Whitman Corporation.
   PepsiCo will transfer to the new company a number of bottling operations,
   including territories in Illinois, Indiana, Missouri and Ohio in the
   United States as well as in the Czech Republic, the Slovak Republic,
   Hungary and Poland.  Those businesses generated 1998 revenue of
   approximately $540 million in the U.S. and approximately $180 million
   outside the U.S.   PepsiCo also will transfer to the new company the 20%
   stake it currently holds in Whitman's Pepsi-Cola General Bottlers
   subsidiary.

   Whitman will transfer to PepsiCo operations in: Marion, Virginia;
   Princeton, West Virginia and St. Petersburg, Russia.  They will become
   part of The Pepsi Bottling Group.  In 1998 those businesses generated
   revenue of $54 million in the U.S. and $23 million in Russia.

   Whitman will assume liabilities associated with PepsiCo's U.S. operations and
   will acquire PepsiCo's  international  operations for cash,  resulting in net
   proceeds to PepsiCo of $300 million.

   PepsiCo will receive 54 million  shares of common stock in the newly  created
   Whitman Corporation,  giving PepsiCo immediate ownership of approximately 35%
   of the company.  Whitman will  undertake a share  repurchase  program that is
   anticipated to raise PepsiCo's stake in the company to nearly 40%.

"Whitman is an excellent  bottler with  tremendous  capabilities,"  said PepsiCo
Chairman and Chief  Executive  Officer  Roger  Enrico.  "This  greatly  expanded
partnership  will  dramatically  strengthen the Pepsi-Cola  bottling  system and
provide better and more efficient service to our customers."

The  transaction,  which is  subject  to  approval  by  regulators  and  Whitman
shareholders,  will  increase  Whitman's  share of  Pepsi-Cola's  bottle-and-can
volume in the United States from 12% to 17%. It will increase Whitman's bottling
volume outside the United States more than four-fold.

As a result  of the  transaction,  PepsiCo  expects  to record a  one-time  gain
sometime after the first quarter of 1999. A proxy  statement/prospectus  will be
filed with the  Securities  and Exchange  Commission  containing  details on the
Whitman transaction.

It is anticipated that the Whitman  transaction will not delay PepsiCo's planned
public  offering  of a  majority  interest  in The  Pepsi  Bottling  Group.  The
registration  statement filed earlier this month in connection with the offering
took the Whitman transaction into account.



FOURTH QUARTER 1998

PepsiCo  said it expects to report  fourth-quarter  1998  earnings  per share of
approximately  24 cents  next  week and made  several  additional  announcements
regarding the quarter:

Settlement with Internal Revenue Service

In  November  1998  PepsiCo  reached  final  agreement  with  the IRS to  settle
substantially  all  remaining  aspects  of a  tax  case  relating  to  PepsiCo's
concentrate operations in Puerto Rico. As a result, PepsiCo will recognize a tax
benefit  totaling $494 million for 1998. Of that $494 million,  $200 million was
recorded in the third quarter, based on settlement of part of the case, and $294
million or 19 cents per share will be recorded in the fourth quarter.

Frito-Lay North America

Frito-Lay  North  America  (FLNA)  has  initiated  a major  program  to  improve
productivity in its U.S. manufacturing operations by consolidating production in
its most  modern  and  efficient  plants,  eliminating  production  redundancies
throughout the system and streamlining logistics and transportation systems.

Under the  program  FLNA will  close  four of its  oldest  plants,  located  in:
Chamblee,  Ga.;  Salisbury,  N.C.;  Jackson,  Miss.  and  Marlborough,  Mass. In
addition, FLNA will expand three of its most technologically advanced plants, in
Lynchburg,  Va.,  Jonesboro,  Ark.,  and  Fayetteville,  Tenn.,  and  two of its
top-performing facilities, in Perry, Ga., and Killingly, Conn.

FLNA will incur one-time charges estimated to total  approximately  $120 million
for costs associated with the program. That total includes $54 million (pre-tax)
or two cents per share relating to elimination of production  redundancies to be
recorded for the fourth quarter of 1998 and  approximately  $65 million relating
to plant  consolidation  and  expansions to be recorded for the first quarter of
1999. Any near-term savings resulting from the efforts will be reinvested in the
business.

Pepsi-Cola International

In recognition of the severe impact of the economic  crisis on its operations in
Russia,  Pepsi-Cola  International  (PCI) will record an unusual  charge of $218
million  or 14 cents per share for the fourth  quarter of 1998 to reflect  asset
impairment and the cost of restructuring of its operations there.

Pepsi-Cola North America

For the fourth  quarter of 1998  Pepsi-Cola  North America  (PCNA) will record a
restructuring  charge of $16  million  (pretax) or one cent per share to reflect
the  costs  of  separating  its  concentrate  and  bottling  organizations.  The
separation  was  intended to enable the  bottling  business to more  effectively
serve retail  customers,  which have been  consolidating  very rapidly in recent
years.  PepsiCo is proceeding  with the  conversion  of a majority  stake in its
Pepsi  Bottling  Group  unit to  public  ownership  through  an  initial  public
offering.

Also, after a very positive consumer response to the October launch of its Pepsi
One one-calorie cola, PCNA chose to invest additional  advertising and marketing
funds to drive  continued trial of the brand late in the fourth quarter of 1998.
The  decision   reflects  PCNA's  strong   commitment  to  this  innovative  and
high-potential new product.

As a result  of the  additional  funding  of Pepsi  One and  highly  competitive
pricing,  PCNA ongoing operating profit for the fourth quarter is expected to be
$206 million.  Including  the $16 million  restructuring  charge,  reported PCNA
operating profit for the fourth quarter is expected to be $190 million.

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