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Britvic has unveiled plans to proceed with an £800m float on the London Stock Exchange next month and said it might take advantage of the global reach of shareholder PepsiCo to extend its brands into international markets.
The British soft drinks company, which is expected to release a prospectus giving a price range for the initial public offering later this month, is going ahead with a float to take advantage of a buoyant UK equity market and growing consumer demand for soft drinks.
The suggested £800m enterprise value of the company includes £300m of debt.
Three of Britvic’s four shareholders – InterContinental Hotels Group, Whitbread and Pernod Ricard – will sell their interests in the company as a result of the IPO. But PepsiCo, which initially invested in Britvic in 1987, will retain its 5 per cent stake.
Paul Moody, Britvic’s managing director, said that while the UK soft drinks company planned to focus on organic growth in domestic markets in the short term, it eventually hoped to take advantage of PepsiCo’s global networks.
Mr Moody, who will be chief executive of Britvic after the IPO, said: “To work with [Pepsi] in different
markets with some of our brands would be one of the real opportunities of the business.”going forward”.
John Gibney, Britvic’s finance director, will retain keep his current position and Gerald Corbett, chairman of Woolworths, will become chairman. Britvic’s board will include four non-executive directors, including Joanne Averiss, a long-term member of PepsiCo’s legal department.
Britvic has a small international business but is mostly focused on the UK market. It currently holds the UK distribution rights to Pepsi and 7UP, and next year will distribute Gatorade, the US company’s fast-growing sports drink. It also has the right to distribute any new carbonated drinks developed by Pepsi.
Pepsi has been expanding into international markets as it diversifies away from carbonated drinks, and international sales now account for more than a third of its total. salesThis year it bought Punica, a German maker of fruit juices and juice drinks, and it is understood to have been in talks earlier this year about a possible takeover of Danone, the French food group.
Britvic is the second-biggest supplier of take-home soft drinks in the UK after Coca Cola Enterprises. Last year Coke sold some 1.7bn litres of soft drinks to consumers to take home, more than double Britvic’s 758m litres, according to ACNielsen, the market research company.
The IPO is being led by Deutsche Bank and Citigroup.