Britvic canning line with cans of Pepsi Max

Britvic canning line with cans of Pepsi Max

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PepsiCo has given Danish brewer Carlsberg the go-ahead to continue its pursuit of soft drinks group Britvic.

In a statement to the London Stock Exchange, Carlsberg confirmed it had reached an agreement with Pepsi to waive the change of control clause in the bottling arrangements it has with Britvic.

The agreement paves the way for Carlsberg to make a renewed offer for the Robinsons supplier following two earlier bids being rejected by the Britvic board, with the most recent valuing the group at £3.1bn.

Britvic’s bottling deal with Pepsi gives it exclusive rights for the likes of 7Up and Lipton Iced Tea in the UK until 2040. However, the contract contains a clause allowing Pepsi to terminate the agreement following a change of ownership at Britvic.

Carlsberg this morning said the waiver from PepsiCo would come into effect if an acquisition proceeded to completion.

The brewer added in the short statement that it was now “considering its position” in regard to a third offer.

“There can be no certainty that any offer will be made,” it said. “A further announcement will be made as appropriate.”

Britvic shares jumped 7.7% as markets opened this morning to 1,178.6p, which is still below the 1,250p offer price rejected by Britvic earlier in the month.

Carlsberg shares fell another 1.1% to DKK 848.80, following a 8% slump last week when its pursuit of Britvic was revealed.

Morning update

Vaping group Supreme has snapped up soft drinks group Clearly Drinks for £15m to diversify its offering.

Established in 1885, Clearly Drinks makes soft drinks and bottles spring water. It supplies major UK retailers such as Tesco, Sainsbury’s, Waitrose, Aldi and Farm Foods.

For the year ended 31 December 2023, Clearly reported revenues of £22.4m and adjusted EBITDA of £3m.

Supreme CEO Sandy Chadha said: “We are delighted to be acquiring Clearly, a high-quality manufacturer and brand owner of soft drinks, which I believe delivers a significant component of our broader diversification strategy.

“Our enlarged business is not only gaining a strong additional pillar, which fully aligns with our vaping, lighting, batteries and sports nutrition & wellness categories, but also a significant opportunity to develop and capitalise on further cross and upsell opportunities which our trusted reputation across the UK retail space facilitates.”

THG said its performance was “on track” after the ecommerce group made further progress in the first half of 2024.

It added, in a trading update ahead of its AGM later today, that the second quarter represented the third in a row of year-on-year revenue growth.

THG also revealed a new partnership with Frasers Group across several areas, including a multi-year agreement between the retailer and ecommerce group’s Ingenuity platform.

The FTSE 100 opened up 0.1% to 8,244.77pts this morning.

The main risers so far is Britvic, with Glanbia up 3% to €18.85 and Naked Wines up 2.2% to 62.3p.

Fallers include Ocado, down another 3.8% to 299.4p, with Virgin Wines also falling 2.2% to 44p and SSP Group 1.4% lower at 150.3p.

This week in the City

Markets will wait expectantly for a renewed knockout offer from Carlsberg for Britvic.

Other than that it is looking like a quiet week for scheduled news in fmcg

The latest BRC shop price index is out on Wednesday, while the Nielsen puts out its monthly grocery sales figures on Thursday.

Walgreens Boots Alliance reports its Q3 results over in the US on Thursday.

Embattled Science in Sport is also due to report its full-year results by the end of the week