Britvic A.G.Barr merger in question pending Competition Commission probe

The proposed merger of soft drinks manufacturers Britvic and A.G.Barr lost some of its fizz after the companies announced that the Competition Commission had opened an investigation.

The proposed merger of soft drinks manufacturers Britvic and A.G.Barr lost some of its fizz after the companies announced that the Competition Commission had opened an investigation.

The groups reported that the Office of Fair Trading had referred the merger to the Competition Commission due to concerns that a tie-up could reduce competition between certain brands of A.G. Barr and Britvic.

A statement issued by Britvic reported that both parties believed that "the merger will not result in a substantial lessening of competition and that they will be able to demonstrate this to the Competition Commission".

However, the probe represents a major set-back for the drinks makers, which previously announced that the effective date of the merger would be February 26th.

The investigation could take six months and after that both companies said there was no longer a guarantee the tie-up would even go ahead.

A statement from Britvic read: "The Competition Commission's investigation is expected to take approximately six months. If clearance is received from the Competition Commission on terms satisfactory to both A.G. Barr and Britvic, the boards of A.G. Barr and Britvic will each reconsider, at that time, the terms of a possible merger between A.G. Barr and Britvic.

"There can be no certainty or assurance that, following such clearance, any such merger would be forthcoming or that any offer will be made by either A.G. Barr or Britvic".

Britvic's brands include Robinsons, Fruit Shoot, R Whites and Tabngo. A.G.Barr's brands include Irn Bru, Tizer and Rubicon.

Britvic's share price was down 8.26% to 385.30p at 11:26 on Thursday.

MF

Recommended

Share tips of the week – 21 January
Share tips

Share tips of the week – 21 January

MoneyWeek’s comprehensive guide to the best of this week’s share tips from the rest of the UK's financial pages.
21 Jan 2022
Seven cheap defence stocks to buy now
Share tips

Seven cheap defence stocks to buy now

We’ve got used to a world without war between major powers, but that era is coming to an end as Russia threatens Ukraine and China eyes Taiwan. Buy de…
21 Jan 2022
Invest in VCTs: tax-free investments set to break records
Investment strategy

Invest in VCTs: tax-free investments set to break records

Generous tax breaks make VCTs – venture capital funds – an attractive supplement to pensions.
21 Jan 2022
HubSpot: a tech stock set to tumble
Trading

HubSpot: a tech stock set to tumble

US tech stocks have had a fantastic couple of years. But this year is unlikely to be so bullish for high-fliers that can’t turn big profits.
18 Jan 2022

Most Popular

Ask for a pay rise – everyone else is
Inflation

Ask for a pay rise – everyone else is

As inflation bites and the labour market remains tight, many of the nation's employees are asking for a pay rise. Merryn Somerset Webb explains why yo…
17 Jan 2022
Temple Bar’s Ian Lance and Nick Purves: the essence of value investing
Investment strategy

Temple Bar’s Ian Lance and Nick Purves: the essence of value investing

Ian Lance and Nick Purves of the Temple Bar investment trust explain the essence of “value investing” – buying something for less than its intrinsic v…
14 Jan 2022
Interest rates might rise faster than expected – what does that mean for your money?
Global Economy

Interest rates might rise faster than expected – what does that mean for your money?

The idea that the US Federal Reserve could raise interest rates much earlier than anticipated has upset the markets. John Stepek explains why, and wha…
6 Jan 2022