Carlsberg Acquires Britvic for $4.2 Billion

As part of expanding its operations across Europe, Danish brewing giant Carlsberg on Monday said that it has reached an agreement to acquire the UK-based soft drink company Britvic for around $4.2 billion.

The acquisition, which has been cleared by the Britvic’s board, will allow Carlsberg to gain a stronger foothold in the UK market, where it is currently the fourth-largest brewer.

Britvic rejected a $3.95 billion takeover bid from Carlsberg in June. The board had turned down a proposal worth $16.02 per share from the beer giant, saying that the offer significantly undervalued Britvic and its current and future prospects.

Britvic is a leading international soft drinks business. Britvic is the main partner for PepsiCo in the UK and Ireland with exclusive rights to manufacture, bottle, and sell brands including Pepsi, 7UP, and Lipton Ice Tea. Britvic also owns a number of brands including Robinsons, Tango, Fruit Shoot, J2O and Aqua Libra.

Britvic is also the largest supplier of branded still soft drinks and the number two supplier of branded carbonated soft drinks in Great Britain. Britvic is an industry leader in Ireland with brands such as MiWadi and Ballygowan; in France with brands such as Teisseire, Pressade and Moulin de Valdonne; and in Brazil with brands such as Maguary, Bela Ischia, Extra Power and Dafruta.

Carlsberg Group CEO Jacob Aarup-Andersen said that with this this transaction, they were 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 other markets in Western Europe.

Attractive for Shareholders

The proposed transaction is attractive for shareholders of Carlsberg, supporting its growth ambitions, being immediately earnings accretive and value-accretive in year three.

He said that they were excited about expanding Carlsberg’s global partnership with PepsiCo and believe that the longer-term opportunities will be very beneficial for both companies.

“We look forward to welcoming Britvic’s employees into the Carlsberg family and creating an exciting, combined company for all employees. We are committed to accelerating commercial and supply chain investments in Britvic, and we are confident that Carlsberg Britvic will become the preferred multi-beverage supplier to customers in the UK with a comprehensive portfolio of market-leading brands,” he added.

PepsiCo CEO for Europe Silviu Popovici said that they too were looking forward to building on their long-standing and successful partnerships with both Carlsberg and Britvic.

“We believe that the combination of Carlsberg and Britvic will create even stronger sales and distribution capabilities for our winning brands in important markets. We look forward to continuing to expand the partnership into further important markets in the future,” Popovici added.