AG Barr merger with Britvic firm collapses
IRN Bru maker AG Barr has called time on a merger with Robinsons firm Britvic after its revised approach was snubbed despite competition clearance for the tie-up.
Barr revealed it made a new proposal following formal notification this week that its now lapsed £1.4bn merger with Britvic had been given the all-clear.
The firm said Britvic turned down the latest potential offer even though it was on "more favourable terms".
AG Barr chairman Ronnie Hanna said he was confident that the AG Barr board "has every reason to be confident of its position as a stand-alone company".
Britvic had raised doubts over a deal after hinting on Tuesday that it was under no pressure to resurrect a merger, in spite of the long-awaited competition clearance being secured. Chairman Gerald Corbett said a new chief executive and the prospect of £30m of cost savings over the next three years meant the merger benefits are "materially less than they were". Britvic shares dropped 2%, while Barr rose more than 1% after yesterday's announcement.
It marks the end of a long-running saga after the deal lapsed in February because of delays caused by the Office of Fair Trading's decision – of which Mr Corbett has been critical – to refer the matter to the Competition Commission.
Mr Corbett has been fiercely critical of the OFT's decision to refer the merger, which would have created one of the leading soft drinks companies in Europe.
In its final report, the commission said the brands owned by Britvic and AG Barr were not close competitors and consumers would not lose out.
Irn-Bru is the largest Barr brand – other Britvic labels include J2O, Fruit Shoot and Tango. Retail sales of soft drinks in the UK amounted to £11.2bn last year.