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Britvic And AG Barr, Owner Of Irn-Bru, Agree Merger Terms

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BRITVIC
Britvic and AG Barr to merge to create a super soft drinks brand | Alamy

The manufacturer of the very English Robinsons and the very Scottish Irn Bru brands are to combine to create a super soft-drink giant.

Britvic, which produces a range of fruit drinks including Robinsons, J20 and Fruit Shoots, is to merge with Scotland's AG Barr, producer of Irn Bru, Tizer and Lipton Iced Tea.

Pepsi and 7UP are also made and sold in Britain and Ireland by Britvic - and Pepsi has agreed not to terminate the contract as a result of the newly merged company forming.

The merger will see Barr's chief Roger White take the helm of the new company, believed to be renamed Barr Britvic Soft Drinks. John Gibney, the current chief financial officer of Britvic will be the CFO of the new company.

Combined sales are predicted to be in excess of £1.5 billion a year, and savings from merging procurement and supply chains are expected to be in the region of £35 million.

However, up to 500 jobs are at risk over the next three years, according to reports from The Sun.


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AG Barr boss Roger White - the new chief of Barr Britvic Soft Drinks - says up to 500 jobs could go over the next three years

The deal has taken some time to be finalised; both firms were hit by poor sales during the damp British summer, and Britvic faced a torrid time after it was forced to recall Fruit Shoots over a faulty cap.

Gerald Corbett, Britvic's chairman, said the merger would create a "world class" drinks company and that the two brands were a "fantastic fit".

"Together we will create a bigger, better and stronger business for our consumers, customers and shareholders for now and the future," he added.

Ronald Hanna, AG Barr's chairman also predicted that the new business would enjoy significant growth potential in all sectors of the market through diversified and enhanced routes to market and the potential of increased international exposure.

"With a clear strategy, strong management team and tight financial control, the union of our two businesses will create real future potential," he added.

The soft drinks industry is experiencing a growth boom in 2012 - The 2012 UK Soft Drinks Report, produced by the British Soft Drinks Association earlier this year, revealed the industry grew in value by 5.1% in 2011 and is valued at £14.5bn.

Consumption grew by 0.7% to reach more than 253.3 litres per person. Bottled water consumption was up by 2.2%, fizzy drinks were up by 4.1% and fruit drinks and smoothies grew in retail value by 4.2% to £1.8m.