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Carlsberg to buy Britvic for £3.3bn

Soft drink maker Britvic, owner of mixer brand London Essence Company, has agreed to a £3.3 billion (US$4.2bn) takeover offer from Danish brewing giant Carlsberg.

Britvic London Essence Company
London Essence Company was given a redesign this year

The boards of Carlsberg and UK-based Britvic have reached an agreement over a recommended cash offer to buy the soft drink producer.

Hemel Hempstead-headquartered Britvic had previously rejected takeover offers from Carlsberg on the grounds that they undervalued the company.

The London Essence Company was created by Britvic-­backed incubator outfit WiseHead Productions in 2016. It became the fastest-growing mixer company in Great Britain in 2022 with a retail sales value of almost £15 million (US$18m).

In the UK, London Essence is the third-biggest mixer brand after Schweppes and Fever-Tree. Earlier this year, London Essence revealed a rebrand and a new can format.

Britvic’s soft drink portfolio includes Robinsons, Tango, Fruit Shoot and J20. The company is also the main partner for PepsiCo in the UK and Ireland.

Carlsberg describes Britvic as one of the leading soft drinks businesses in Great Britain, Western Europe and Brazil.

The brewer called the deal a ‘highly attractive opportunity’ for the company, that will also support its growth ambitions.

The acquisition will build on Carlsberg’s bottling business in the Nordic region, and ‘deepen and strengthen its footprint’ in Western Europe, an important region for the brewer.

Jacob Aarup-Andersen, CEO of Carlsberg said: “With this transaction, we are combining Britvic’s high-quality soft drinks portfolio with Carlsberg’s strong beer portfolio and route-to-market capabilities, creating an enhanced proposition across the UK and markets in Western Europe.

“The proposed transaction is attractive for shareholders of Carlsberg, supporting our growth ambitions and being immediately earnings accretive and value accretive in year three. We are excited about expanding our global partnership with PepsiCo and believe that the longer-term opportunities will be very beneficial for both companies.”

‘Growth opportunities in multiple drinks sectors’

The brewing firm plans to create a single enlarged company, which will be named Carlsberg Britvic.

Ian Durant, non-executive chair of Britvic, added: “Britvic is an outstanding business with a strong heritage built on its portfolio of family-favourite brands, long-standing customer relationships, a well-invested supply chain infrastructure and a fantastic team of people across multiple markets.

“All these factors have supported a consistent track record of delivery for Britvic’s stakeholders over a sustained period of time. The proposed transaction creates an enlarged international group that is well-placed to capture the growth opportunities in multiple drinks sectors.

“Crucially, to remain competitive at a time when the market is being shaped by the trend of increasing consolidation among bottling partners, Carlsberg’s agreement with PepsiCo provides the combined group with a strong platform for continued success.”

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