Ebba operates the Dafruta and Maguary brands.
Britvic has acquired Brazilian liquid concentrates and ready-to-drink nectar drinks producer Ebba in a deal worth just over £120.8m.
The transaction means that Britvic has gained immediate access to the Brazilian market – the world’s sixth largest in terms of soft drinks and the leading market for concentrates – for the first time. It intends to accelerate growth in Ebba by building on its existing platform and route to market, extending its Maguary and Dafruta brand into new sub-categories, the Chelmsford-based business said.
Britvic has revealed that it hopes to double the £87m that Ebba turned over last year by 2020, on the same day that it reported a 1% increase on quarter three year-on-year revenue – up to £322.3m – for itself.
The soft drinks company said that the Brazilian market had achieved retail sales value growth of 13.6% during the last year, while its juice drinks category recorded volume growth of almost 10% over the past five years.
In a statement this morning, Britvic said: “Britvic has spent a considerable amount of time analysing the Brazilian market and conducting due diligence on the acquisition, and believes that the Brazilian soft drinks market is relatively underdeveloped when compared with other markets in which Britvic operates. Specifically, the liquid dilutes category has
lacked investment whilst the juice drinks category under-indexes in share. In addition, in Britvic’s view, the kids category is currently commoditised, whilst there is no discernible adults category and a lack of engaging soft drinks fixture in-store. Britvic is confident that these current characteristics provide a backdrop against which to drive attractive future growth.”
And the company’s chief executive officer, Simon Litherland, added: “The acquisition of Ebba represents a unique opportunity to acquire a high quality business in a substantial soft drinks market, with exciting future growth potential. Ebba operates in categories where Britvic has a proven capability of building new markets, accelerating innovation and establishing brand leadership. We have been in dialogue with Ebba for some time and have completed a significant amount of due diligence in assessing the value and prospects of the business and the wider marketplace.
“Ebba’s brands are particularly strong, and have a relevance to Brazilian consumers similar to the ones which Robinsons, MiWadi and Teisseire enjoy in their home markets. I am particularly pleased that the management team, led by João Caetano de Mello Neto, will continue to lead the business.
“We have identified opportunities to invest behind these leading brands, introduce new brands, and harness our group capability. As a result, we are confident we have a fantastic opportunity to drive long-term growth in the kids, family and adult categories and deliver significant shareholder value over the coming years.”
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