UK beverage group AG Barr has sold its Strathmore water brand to Wales-based water business Tŷ Nant.
Financial terms were not disclosed.
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In a statement today (29 July), AG Barr said the disposal included a production site in the Scottish town of Forfar.
In March, AG Barr said it would scrap the Strathmore brand as it had “struggled to compete” in recent years.
A month later, the London-listed group said it had entered exclusive discussions with a buyer, whose details were not disclosed at the time.
In today’s statement, released alongside a broader trading update, AG Barr said the sale of the Strathmore assets would “negatively” affect revenue “in the short-term but not profit”.
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By GlobalDataTŷ Nant, based in western Wales, dates to 1976, with its official launch in 1989 at London’s Savoy Hotel. It has become known for its cobalt blue glass bottles.
Last year, the company acquired the brands Fonthill Water and Decantae Mineral Water from US-based Primo Water.
In a statement, Tŷ Nant said Strathmore water would continue to be bottled at source in Forfar, adding “every job at the site has been safeguarded as part of the transaction”.
“This is a brand with a deep legacy and a loyal following, and we are honoured to be entrusted with its next chapter,” Tŷ Nant chairman and director Raminder Sidhu said.
In AG Barr’s trading update, the company said its momentum improved in the first half of the year.
For the 26 weeks ended 26 July, AG Barr expects revenue of approximately £228m ($304.5m), a 3% increase from the previous year.
The adjusted operating margin for the first half is anticipated to be around 15%, up from 13% the previous year.
AG Barr attributed the improvement to “improved manufacturing efficiencies”, “strategic business improvement initiatives” and “continued disciplined cost management”.
Euan Sutherland, CEO of AG Barr, said: “Trading improved during H1, and we enter H2 with strong momentum and continued progress on margin improvement as our strategic initiatives continue to deliver.”
Earlier this month, AG Barr acquired a 50.1% equity stake in Innate-Essence for an initial consideration of £15m. Innate-Essence owns The Turmeric Co., a brand in the functional shots market.
Sutherland added: “I am also excited about our expansion into the functional beverage segment working alongside Thomas Robson-Kanu and the Innate-Essence team.”
