Britvic rejects improved takeover bid from Carlsberg
UK-based soft drinks manufacturer Britvic has turned down an improved takeover offer from Danish brewing giant Carlsberg Group, following an initial offer earlier this month.
Britvic, which operates five drinks canning lines at its facility at Rugby, producing up to 550,000 cans of soft drinks an hour, rejected the improved cash offer to acquire the entire issued and to be issued ordinary share capital of the company, at an offer price of 1,250 pence per share.
That offer followed an initial proposal from Carlsberg, made on 6 June, at an offer price of 1,200 pence per Britvic share.
Britvic stated: “The Board together with its advisers carefully considered the Second Proposal, and concluded that it significantly undervalues Britvic, and its current and future prospects. Accordingly, the Board unanimously rejected the Second Proposal on 17 June 2024.”
Carlsberg Group outlined in a statement that it “believes that the Proposal represents a compelling opportunity for Britvic shareholders to realise their investment in full in cash at an attractive valuation”, noting that its proposed offer represented an implied enterprise value multiple of 13.1 times Britvic’s last 12 months’ (LTM) adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) of £302 million for the 12-month period ending 31 March 2024, and a premium of 29% on the Britvic closing share price of 970 pence per share on 19 June.
Carlsberg is now considering its position, the company added.
In 2023, Britvic invested £13m in the fifth canning line at the Rugby facility, which followed the £26.9m installation of a fourth canning line in 2021. The addition of those two lines doubled the canning capacity of the facility, which alongside the four PET bottling lines made the site one of the five largest soft drinks manufacturing sites in Europe, Britvic said.
Britvic produces its own range of soft drinks, as well as producing a number of other brands, establishing a 20-year franchise bottling agreement with PepsiCo for the production, distribution, marketing and sales in the UK of the US giant’s carbonated soft drinks, including Pepsi, Pepsi Max, 7UP, Mountain Dew, and the Rockstar energy drink portfolio.
Last year, Britvic also acquired ready-to-drink iced coffee brand Jimmy’s, which uses resealable aluminium bottle-cans manufactured by Japanese canmaker Daiwa, as well as conventional slim 250ml cans, for its products.
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