Carlsberg Britvic: brewer acquires UK brands, Marstons takeover, investor share price and relations - news

• Carlsberg has agreed to acquire the maker of Robinsons squash in a multi-billion pound deal
• The deal, valued at £4.1 billion including debts, was accepted after the rejection of a previous lower bid
• Carlsberg will pay 1,315p per share to Britvic shareholders
• The acquisition will create a unified drinks business named Carlsberg Britvic
• Carlsberg will also take full control of Carlsberg Marston’s Brewing Company

Danish brewing giant Carlsberg has agreed to acquire Robinsons squash maker Britvic in a deal worth £3.3 billion.

The UK soft drinks company, which also produces J2O and Tango, informed shareholders on Monday morning (8 July) that it will recommend this latest offer – valued at £4.1 billion when including debts – after previously rejecting a £3.1 billion bid.

Under the agreement, Carlsberg will pay 1,315p per share to Britvic investors. Britvic also holds an exclusive licence with US partner PepsiCo to manufacture and distribute brands such as Pepsi, 7up and Lipton iced tea in the UK.

Britvic shareholders will vote on the proposed takeover at a general meeting in the coming months. The news comes as Britvic hailed strong growth in the latest quarter despite wet weather across Europe.

Group revenues grew by 6.3% to £502.9 million in the three months to 30 June, with growth across both retail and hospitality in the UK.

In a separate deal, Carlsberg also agreed to take control of its UK brewing joint venture with Marston’s, the Carlsberg Marston’s Brewing Company, which makes brands including Hobgoblin and Pedigree.

Marston’s confirmed it will receive £206 million to sell Carlsberg its 40% stake in the venture.

It comes four years after the two brewers formed the UK joint venture in a deal valuing the operation at £780 million, as Marston’s sought to focus more on its pub operation.

What does it mean for my favourite drinks?

The deal between Carlsberg and Britvic is unlikely to have any immediate, direct impact on Carlsberg beer drinkers or Robinsons squash drinkers.

But Carlsberg has said it plans to create a single integrated drinks business called Carlsberg Britvic after completing the deal, and with the combined resources of Carlsberg and Britvic, consumers might see improved availability of both Carlsberg beers and Britvic soft drinks.

For shareholders of both companies, the deal has significant implications, and the Danish firm has said it believes the integration with Britvic can secure it £100 million in cost efficiencies a year.

Acquiring Britvic also allows Carlsberg to diversify its product portfolio beyond beer, potentially reducing risk and increasing revenue streams.

Ian Durant, non-executive chairman of Britvic, said: “The proposed transaction creates an enlarged international group that is well-placed to capture the growth opportunities in multiple drinks sectors.”

The deal also enhances Carlsberg's market presence in the UK, particularly in the non-alcoholic beverage sector, which could lead to long-term growth and profitability.

Carlsberg Group chief executive Jacob Aarup-Andersen 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 other markets in Western Europe.”

Will the deal lead to cheaper pints?

Carlsberg is a well-known global brand with a strong UK presence, and has established itself as a major player in the beer market.

Marstons has a strong heritage in brewing dating back to the 19th century, is known for its traditional ales, and has a loyal following among ale enthusiasts. It also owns and operates a large number of pubs across the UK.

Unfortunately, the deal is unlikely to directly lead to cheaper pint prices for Carlsberg or Marstons beers, as pricing decisions are influenced by factors such as production costs, competition and consumer demand.

A merger like this primarily affects the companies involved in terms of their operational efficiencies and market positioning, rather than directly impacting retail prices.

Carlsberg may benefit from potential cost efficiencies from the merger, but these savings are typically reinvested into the business or used strategically rather than passed on directly to consumers as lower prices.

Justin Platt, who became chief executive at Marston’s at the start of the year, said: “This deal further strengthens our balance sheet, significantly reducing our debt by over £200 million.

“Crucially, it allows us to become a pure play hospitality business and focus on what we do best – namely, giving our guests amazing pub experiences.”

We want to hear from you! What are your thoughts on Carlsberg's acquisition of Britvic and its implications for the beverage industry? Do you think this merger will impact your favorite drinks or local pubs? Share your insights and join the discussion in the comments section.