Pepsi paves way for Carlsberg’s £3 billion takeover tilt for Britvic

Danish beer group Carlsberg confirmed it has struck a deal with Pepsi which removes a potential block to its takeover swoop for Robinsons maker Britvic.

Carlsberg said US drinks firm PepsiCo has agreed to waive a so-called change-of-control clause as part of its long-term bottling agreement with British soft drinks group Britvic.

The clause was effectively a poison-pill arrangement that could have prevented an acquisition of Britvic by allowing Pepsi to end its bottling deal, making the UK company a less attractive takeover target.

It was first reported at the weekend that Pepsi had told Carlsberg it would not look to exercise the clause in the case of an agreed takeover of Britvic.

Carlsberg said: “Carlsberg confirms that it has reached agreement with PepsiCo whereby PepsiCo has agreed to waive the change-of-control clause in the bottling arrangements it has with Britvic.

“This waiver will come into effect should an acquisition of Britvic by Carlsberg, which has the recommendation of Britvic’s board, proceed to completion.”

Shares in FTSE 250-listed Britvic rose as much as 11% in Monday morning trading, having surged on Friday after it said it had rejected a £3.1 billion takeover move by Carlsberg.

Britvic said the approach “significantly undervalues Britvic, and its current and future prospects”, but added it would “consider any further proposal on its merits”.

Carlsberg said on Monday that it is “considering its position” amid reports it could be preparing to put forward a proposal of up to £14 a share.

A takeover of Britvic would mark yet another sale of a UK-listed company as low valuations have seen foreign buyers strike deals for British counterparts, including the £5.8 billion acquisition of FTSE 100 packaging firm DS Smith.

Britvic, which has its headquarters in Hemel Hempstead, Hertfordshire, said last week that it had rebuffed a proposal from Carlsberg for the whole business on June 11.

It said the potential bid valued the company at 1,250p per share.

Britvic revealed the approach came a week after it had rejected a 1,200p per share approach from Carlsberg.

Carlsberg issued a separate statement on Friday confirming the move to its investors, saying it believes there could be long-term growth opportunities from a deal.

The Danish company said: “Carlsberg believes that the proposal represents a compelling opportunity for Britvic shareholders to realise their investment in full in cash at an attractive valuation.

“Carlsberg believes that the potential transaction would enable it to capture appealing long-term growth opportunities from Britvic’s comprehensive portfolio of leading brands in an attractive segment of the beverage market where Carlsberg already has a strong track record.”

It comes four years after Carlsberg significantly expanded in the UK through its £780 million joint venture deal with Marston’s, creating the Carlsberg Marston’s Brewing Company, which makes brands including Hobgoblin and Pedigree.