By W. G. S. D. Wijesinghe, Jadetimes news
Carlsberg has secured a £3.3 billion agreement to acquire Britvic, the producer of drinks like Robinsons squash and J20. The Danish brewer announced that this acquisition would lead to the creation of a unified beverage entity called Carlsberg Britvic, aimed at expanding its business in the UK and Western Europe.
Ian Durant, Chairman of Britvic, described Carlsberg's takeover offer as "compelling." The agreement will grant existing Britvic shareholders £13.15 per share, following the rejection of a lower offer last month. Durant emphasized that the merger would form "an enlarged international group well positioned to capture growth opportunities in various beverage sectors."
Britvic shareholders will vote on the proposed acquisition at a forthcoming general meeting. Despite adverse weather conditions across Europe, Britvic reported strong quarterly results, with group revenues increasing by 6.3% to £502.9 million for the three months ending June 30.
Russ Mould, Investment Director at AJ Bell, noted that Britvic would add "some diversification" to Carlsberg's portfolio, highlighting that Carlsberg is adjusting to a market where younger consumers are less inclined to consume alcohol heavily.
Britvic holds an exclusive license with PepsiCo to produce and distribute brands such as Pepsi, 7up, and Lipton iced tea in the UK, while Carlsberg also has a bottling agreement with the American company. Susannah Streeter, Head of Money and Markets at Hargreaves Lansdown, remarked that the acquisition offers Carlsberg an opportunity to expand its global partnership with PepsiCo and streamline bottling operations across Europe and the UK.
Additionally, Carlsberg announced a separate deal on Monday to take full control of its UK brewing joint venture with Marston's, which produces beers like Hobgoblin and Pedigree. Marston's confirmed it would receive £206 million to sell its 40% stake in the venture to Carlsberg.
Russ Mould commented on the dual acquisitions, noting, "It’s rare to see a business execute two deals in one day, but sometimes the stars align." He added that the decision to acquire Marston’s stake in the brewing joint venture indicates that beer remains a significant part of Carlsberg’s strategy.
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