Barr-Britvic merger on hold as OFT puts their marriage on hold
Written by Scott Campbell.
 
 
Published at 16:52 GMT on Tuesday 19th February, 2013.
Picture is copyright of Bill Henry and used on his courtesy.
 
CUMBERNAULD will remain the interim location of where Irn Bru is brewed ‘fae girders’ after the Office of Fair Trading put the brakes on a merger deal between Cumbernauld’s AG Barr and English rival, Britvic.
 
The £1.4bn merger deal was suspended by the OFT on Wednesday 13th February, 2013 after fears that the merger would distort Scotland’s soft drinks market competition.
 
The Office of Fair Trading announced its decision after analysing the corporate marriage, which would see over 300 jobs lost, declaring that a merger could distort the market, announcing further that it was referring the proposal to the Competition Commission.
 
The unexpected puts the merger on an unsure path.
 
“We are bemused and unamused. Our merger is about two British companies getting together to strengthen themselves against a vast American conglomerate and now it has been chucked into the Competition Commission by the OFT. We will review this decision”, Britvic’s chairman Gerald Corbett said.
 
Following the OFT’s announcement, both drinks manufacturers released a stock market statement, declaring that they felt the deal “will not result in a substantial lessening of competition and that they will be able to demonstrate this [to the commission]”.
 
The Competition Commission’s investigation is expected to last six months. However, if approval is given from the Competition Commission on ‘satisfactory’ terms, then AG Barr and Britvic will reconsider their merger and seek shareholder approval once again.
 
 
 
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