Carlsberg and Britvic reached a deal back in July, which will see the Danish brewing giant pay £3.3bn to buy the British soft drinks business.
The anticipated creation of a UK beverage heavyweight across both beer and soft drinks, however, led the UK’s Competition and Markets Authority to open an inquiry into the merger: investigating whether the new entity could be expected to result in a ‘substantial lessening of competition’.
A merger inquiry was officially launched in October, but this morning, the CMA announced it has cleared the acquisition.
It means that all regulatory conditions for the deal have now been satisfied, with the European Commission also having okayed the deal.
Britvic shareholders also gave the acquisition the green light back in August.
The deal is now expected to close on January 16, according to a statement from Carlsberg and Britvic this morning.
The Britvic acquisition is set to be ‘transformative’ for Carlsberg’s UK business, creating a ‘highly attractive multi-beverage supplier of scale’.
Britvic is the largest supplier of branded still soft drinks in Great Britain, and the second largest supplier of branded carbonated soft drinks. The brands include big British names such as Robinsons, Tango and J2O, but the company has also diversified into areas such as plant-based milk (Plenish) and iced coffee (Jimmy’s Iced Coffee, acquired in 2023). It also has an exclusive license with PepsiCo to make and sell brands such as Pepsi MAX, 7UP, Rockstar Energy and Lipton Ice Tea.
Revenues in 2023 reached £1.75bn, demonstrating 6.6% year-on-year growth.
In a separate deal, Carlsberg will buy Marston’s Brewing Company’s 40% stake in brewer Carlsberg Marston’s for £206m.
Carlsberg will take both the soft drink and beer businesses and combine them into a single integrated company called Carlsberg Britvic.
That will mean that the newly-created business will be able to operate across beer and soft drinks and make the most of the synergies between the two.
Both beer and soft drinks, for example, are commonly served in cans: creating an opportunity for joint procurement of cans and even the possibility to run canning for both drinks on the same line. R&D is another potential area for sharing resources: such as on sustainability and flavor development.
Carlsberg also believes it can create £100m in cost synergies over the first five years.
