The UK’s Competition and Markets Authority (CMA) has approved the £3.3bn acquisition of Britvic, the soft drinks giant, by Danish brewing company Carlsberg.
The deal, which will merge Britvic’s extensive soft drinks portfolio with Carlsberg’s beer brands, has sparked fears of significant job losses across the UK.
The CMA cleared the takeover just ahead of its deadline for the first phase of investigation, with a full statement detailing the reasons for approval expected later on Tuesday.
The merger will establish a new entity, Carlsberg Britvic, which aims to create a “beverage powerhouse” in the UK and Europe. The deal is slated for completion in January.
Carlsberg highlighted the strategic benefits of the merger in a statement:
“The combination of Carlsberg and Britvic will create a highly attractive multi-beverage supplier in the UK, with an efficient supply chain and distribution network that provides our customers with a portfolio of market-leading brands and world-class service.”
Carlsberg expects the merger to yield cost savings of £100m annually over five years. However, this efficiency drive has raised concerns, with the Unite union warning earlier this year that up to 345 jobs could be at risk, primarily in the UK.
Carlsberg has yet to comment on potential redundancies but previously announced plans for a detailed review of Britvic’s operations.
It pledged “significant investment” in sales functions across the UK and Ireland, including expanding its sales team.
However, the upcoming closure of the Banks’s brewery in Wolverhampton, which will cut 97 jobs, underscores the potential challenges ahead.
Britvic, headquartered in Hemel Hempstead, has a storied history dating back to the 1930s when it was founded as the British Vitamin Products Company.
It operates in over 100 countries, with 39 brands, including Robinsons, which famously partnered with the Wimbledon tennis tournament for 86 years.
The company also holds an exclusive licence with PepsiCo to produce and distribute major brands like Pepsi Max, 7UP, Rockstar Energy, and Lipton Ice Tea in Great Britain and Ireland.
Carlsberg has secured an agreement with PepsiCo to waive a contract clause that could have jeopardised this arrangement following the change in ownership.
As the two companies integrate, Carlsberg Britvic aims to dominate the UK beverage market with an expanded portfolio and streamlined operations. However, concerns over job losses and plant closures highlight the human cost of this significant merger.
