Pepsi: Burger King in China won't serve Coke

NEW YORK Diners who go to a Burger King (BKW) in China can now expect to be served Pepsi, rather than the Coke they get at the fast-food chain in the United States.

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PepsiCo (PEP) says it struck a deal to serve its drinks at Burger King in China for the first time, taking over a deal the chain had with the Coca-Cola (KO). Though Burger King is the world's second largest hamburger chain, it has fewer than 100 locations in China. But the Miami-based company has said it plans to expand significantly in China over the next several years through a joint venture with a franchise operator.

Fountain soda accounts for about a quarter of soft drink sales volume in China, according to the market researcher Euromonitor International. Globally, Coca-Cola, based in Atlanta, still has a far larger share of the broader soft drink market than PepsiCo.

PepsiCo, based in Purchase, New York, recently moved to broaden its distribution in the fast-growing China market by swapping its holdings in its bottling operations there for a stake in Tingyi, a Chinese beverage maker.