Carlsberg has agreed to buy British soft drinks maker Britvic in a deal worth £3.3 billion in a bid to create a UK beverage company, it was announced on Monday.
The Danish brewer has also agreed to buy out Marston’s from its joint venture with the company.
Carlsberg’s shares rose nearly 4% in morning trade, while Britvic rose nearly 5% and Marston’s jumped 15%.
Analysts from Jefferies said in a note, “We view it (the Britvic deal) as a relatively low risk transaction with attractive financials.”
In its announcement, Carlsberg said that it plans to create an integrated beer and soft drinks company in Britain.
It plans to do this by taking advantage of common procurement, production and distribution networks.
Founded in Denmark in 1847, Carlsberg has a long history in Britain.
It first shipped beer to the UK in 1868 and started brewing in Northampton, England in 1973.
In the 1990s, Carlsberg merged with the owners of Tetley’s ale and in 2020 formed a brewing joint venture with Marston’s.
This new venture between Carlsberg and Britvic will also strengthen the brewer’s relationship with PepsiCo, which has bottling deals with both companies.
Expanding Offering
All major brewers have been looking to expand into new products in the face of long-term declines in some markets.
These include drinkers switching to spirits or cutting back on alcohol consumption altogether.
Britvic sells non-alcoholic drinks in Ireland, Brazil, the UK and other international markets such as France, the Middle East and Asia.
The Britvic deal will help deepen Carlsberg’s footprint in Western Europe and build on its bottling business in the Nordic region.
The Danish firm predicts cost savings of around £100 million, it said.
Carlsberg raised its bit for Britvic to 1,315 pence per share – comprising cash and a special dividend of 25 pence per share – after the soft drinks company rejected an offer of 1,250 pence per share last month.
Marston’s said on Monday it would sell its 40% stake in its joint venture – Carlsberg Marston’s Limited – for £206 million in cash.
Read More: PepsiCo To Waive Clause In Bottling Deal As Carlsberg Eyes Britvic Bid
