Britvic to acquire French drinks group

Drinks giant Britvic today reported a 39% leap in half-year profits and revealed plans to snap up French group Fruite.

Britvic, which also makes J20, Pepsi and 7Up, announced the €237m deal as it posted interim pre-tax profits of £27.8m (€32.4m) for the six months to April 11.

It said the acquisition would give the group a foothold in the €12.5bn French soft drinks market, in which Fruite claims to be the leading independent company, while also acting as a platform for growth across Western Europe.

Fruite’s range includes dilutable syrup brands Teisseire and Moulin de Valdonne and pure juice specialist Pressade.

The proposed takeover comes as Britvic confirmed sales were up 4.6% in the first half, despite a difficult second quarter when a harsh winter and tough comparatives saw a slow-down in demand.

But it hailed a “return to robust growth” in the second half so far amid signs of modest improvements across all markets, while the struggling Britvic Ireland arm scraped back into profit in the first six months.

Britvic also forecast that new product innovations in the British market were expected to add between 1% and 2% to annual revenues.

Paul Moody, chief executive of Britvic, said: “We saw sustained market growth in Britain and recent conditions across the wider market have continued to demonstrate elements of recovery.

“However visibility in both Britain and Ireland beyond the short-term remains limited.”

Britvic shares were volatile as investors digested news of its interim results and deal announcement, although the stock later rose 2%.

The Fruite move marks another step forward in Britvic’s aim to expand across European soft and fizzy drinks markets and help drive cost synergies.

Britvic estimated the Fruite acquisition would see it achieve €10m in cost savings by 2013.

Fruite’s biggest market by far is France, accounting for 91% of turnover, although it also exports to the UK and other European countries.