The UK’s competition watchdog Competition and Markets Authority (CMA) has launched a formal investigation into the £3.3bn takeover of the UK soft drinks maker Britvic by the Danish brewer Carlsberg.
CMA has set a deadline of Dec 18 for the first phase of its investigation into the deal. Alongside the announcement, the CMA has released a second invitation for comments on the deal, to enable “all interested parties a further opportunity to submit views” on the potential impact of the acquisition on national competition.
Interested parties are required to send their opinions by 6 November. The call for a second set of comments today (23) follows on from the watchdog’s initial call in September.
Britvic – maker of brands including Robinsons squash, J20 and R White’s lemonade – accepted a £13.15-a-share offer from Carlsberg in July. This came after it had rejected previous takeover offers from Carlsberg on the grounds that they undervalued the company.
Carlsberg has said the deal would allow it to combine Britvic’s soft drinks products with its own beer offering, creating a beverage “powerhouse” in the UK and elsewhere in Europe. The regulator said in September it was looking into whether the deal could reduce competition in the UK market, and has now decided to launch a formal investigation.
After the December deadline, the CMA will decide whether to conduct an in-depth phase 2 investigation into the deal or give it the green light.
A spokesperson for Carlsberg said the CMA’s investigation was “a normal process that was expected, and we look forward to working constructively with the CMA as it progresses”.
“We believe that the combination of Carlsberg’s business with Britvic will create a highly attractive multi-beverage supplier, benefiting from an efficient supply chain and distribution network, and providing customers with a portfolio of market-leading brands and leading customer service," the Carlsberg spokesperson
Provided the deal is approved by the regulator and other conditions are satisfied, the brewer hopes to complete the transaction in the first quarter of 2025.
Carlsberg hopes to find annual cost savings of about £100m over five years through the deal, including through procurement and supply chain efficiencies as well as economies in administration and overheads.
Britvic, headquartered in Hemel Hempstead, Hertfordshire, was founded in the UK in the 1930s as the British Vitamin Products Company and used soft drinks as an affordable way of supplying vitamins to consumers. It has 39 brands in 100 countries including Brazil, France and Ireland.
It also has an exclusive licence with PepsiCo in Great Britain and Ireland to make and sell Pepsi Max, 7UP, Rockstar Energy and Lipton Ice Tea. Robinsons had been an independent company until it was acquired by Britvic in 1995.
In June, Britvic rejected a £3.1bn takeover bid by Carlsberg, saying it undervalued the company, before accepting an improved offer the following month.
