Fri, 15 Feb 2013 | MERGER
Drinks giants Britvic and AG Barr have promised that a merger between the two companies would not harm consumers.
The businesses were due to enter into a £2 billion merger deal this month, but progress was halted when the Office of Fair Trading (OFT) took a surprise decision to refer things through to the Competition Commission.
Fears of an increase in prices on some brands were behind the decision to refer the merger. It added that many people viewed Barr's Irn Bru and Orangina brands as alternatives to Britvic's Pepsi and Tango, so bringing the two together could reduce competition in pricing. But a joint statement from the two groups insisted that the deal “would not result in a substantial lessening of competition”.
Gerald Corbett, chairman of Britvic, said that he was “bemused” by the decision to refer the deal to the regulator, especially given that even once combined the two companies would only have a 14 per cent share of the soft drinks market, half that of Coca-Cola Enterprises.
Britvic may be particularly disappointed in the delay as the firm has seen a number of profits warnings flagged up in the past three years. A merger with Barr would help give it a more positive outlook for a sustainable future, even if there would need to be some significant restructuring to get an agreeable deal in place.
The OFT will publish confirmation of the ruling next week along with further details about the referral but it looks likely that a six-month investigation by the Competition Commission will go ahead. If the companies receive clearance at the end of this investigation they confirmed that they would “each reconsider, at that time, the terms of a possible merger”.
___________________________________________________________________________
Related News:
Britvic buys C&C soft drinks and distribution business for £169.5m
Seeking an acquirer / strategic partner for this long-established national engineering contractor providing an extensive range of solutions, including specialised fabrication, pipework installation, steelwork and mechanical equipment.
Our client, with a legacy spanning over 35 years, has crafted an exceptional brand and market-leading business in the world of organic wines. Now, due to retirement plans, they are seeking the perfect successor to carry forward their legacy.
Over the past 15+ years, our client has built a successful business providing a range of commercial cleaning and soft services to its contracted and growing client base. Working predominantly within the commercial and industrial sector, our client ma...
03
|
Apr
|
Whitworths Food Group buys oils group KTC Edibles | BUSINESS SALE
Northamptonshire-based Whitworths Food Group is buying KTC E...
02
|
Apr
|
NVM exits travel tech firm Intuitive with Banyan Software deal | BUSINESS SALE
Banyan Software has bought a technology provider of end-to-e...
02
|
Apr
|
CheckFire Group buys long-standing partner PJ Fire | BUSINESS SALE
CheckFire Group, the South Wales-based fire safety equipment...
16
|
Oct
|
Summerhouse Drinks buys juice supplier | BUSINESS SALE
Aberdeenshire-based Summerhouse Drinks has bought one of its...
05
|
May
|
Britvic acquires plant-based drinks brand | BUSINESS SALE
Britvic plc has announced the acquisition of plant-based dri...
12
|
Jul
|
AG Barr abandons merger deal with Britvic | MERGER
AG Barr has called off its planned merger with rival soft dr...
Business Sale Report is the complete resource for finding genuine acquisition opportunities.
Join today to receive:
All this and much more, including the latest M&A news and exclusive resources
Please choose your settings for this site below. For more information please read our Cookie Policy
These cookies are necessary for our website to function properly and provide you with access to all features.
These are analytics cookies that help us to improve the way our website works.
These are used to improve the functional performance of the website and make it easier for you to use.