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Carlsberg has agreed to buy soft-drinks maker Britvic for £3.3bn in a deal that would allow the Danish brewer to expand its drinks bottling activities for PepsiCo and grow its operations in the UK.

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Carlsberg to buy Robinsons maker Britvic in £3.3bn deal

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What’s going on HERE?

Carlsberg has agreed to buy soft drinks maker Britvic for £3.3bn in a deal that would allow the Danish brewer to expand its drinks bottling activities for PepsiCo and grow its operations in the UK.

Why is this happening?

Carlsberg has seen a decrease in alcohol consumption and therefore, it wants to maintain its dominance in the market and, expand into the soft drinks market.

What are its impacts on Carlsberg?

The deal will offer Carlsberg a bigger platform in the UK, where it is the fourth-largest brewer.

Also, the shares in Carlsberg rose by 4% in Copenhagen on Monday, as the company sought to assure investors that the acquisition would bring attractive synergies and cost savings of £100mn over five years.

What are its impacts on Britvic?

The shares in FTSE 250 soft drinks maker Britvic (BVIC) have jumped 4.8% after their agreed deal with Carlsberg.

Are there any legal factors that influenced this change?

As drinkers in some markets ditch beer for spirits or cut back in drinking altogether, brewers have looked to broaden their portfolio into new categories like hard seltzer, canned cocktails and cider, as well as zero-alcohol brews.

What will happen next?

The deal is likely to deliver several benefits including cost and efficiency savings worth 100mn over five years as it takes advantage of common procurement, production and distribution networks.

Which firms are involved?

Bake McKenzie advised Carlsberg on its acquisition of Britvic.

Linklaters advised Britvic Plc on its takeover by Carlsberg A/S, combining the two major bottlers of PepsiCo Inc. soft drinks.

Hope you enjoyed it! 

Lemah Islam