UK: PepsiCo blocks early Britvic sale
Hopes of an early sale of UK soft drinks firm Britvic have been dashed after PepsiCo reportedly blocked a sale to private equity companies.
Private equity firms, Cinven, headed by Iain Napier ex-Bass Brewing CEO, CVC Capital Partners and Doughty Hanson are all reported to have entered the second round of the £600m (US$870m) bidding for Britvic.
Although 90% of Britvic is owned by UK companies Six Continents, Allied Domecq and Whitbread Holdings, it is PepsiCo's 10% stake in the company which is proving, as predicted earlier by just-drinks, to be the most powerful voting block in deciding who finally gets control.
A report by the Mail on Sunday newspaper claims the private equity bidders want an assurance from PepsiCo that the distribution licence, valid until 2007 would be renewed.
Miles Templeman, who is heading the CVC bid for Britvic told the Mail on Sunday that he believed a sale to a private equity group was still possible but added that PepsiCo holds the cards because the licence is critical.
PepsiCo meanwhile is believed to be backing a bid for Britvic by bottling giant, the Pepsi Bottling Group, which is 40% owned by PepsiCo.
Pepsi Bottling currently has no facility in the UK, but some analysts fear that PepsiCo's influence could mean if Pepsi Bottling gets control of Britvic, the Britvic business could suffer.
One analyst told just-drinks.com: "Britvic could be a nice revenue stream for Pepsi Bottling and if they use good management and let it run as Britvic I can't see there being a problem. Otherwise it could become a Pepsi bottling franchise and not much else."
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