Britvic has agreed to acquire Brazilian concentrates and juice business Bela Ischia in an acquisition worth BRL 218 million (£54.5 million).
Bela Ischia is active in Brazil’s ready-to-drink (RTD) juice and liquid concentrates segments – two of the largest cornerstones of the country’s highly competitive juice market. Its largest presence is in the Rio de Janeiro and Minas Gerais state, which Britvic described as ‘key areas’ for the company in Brazil, and it recorded pre-tax earnings of around £4.6 million from £40 million’s worth of revenue in the last 12 months.
The transaction, Britvic said, would both strengthen its portfolio in Brazil and create a broader regional footprint by complementing the company’s existing strengths in São Paulo and northeastern Brazil, acquired through the £120 million takeover of concentrates producer Ebba in 2015.
Ebba, which owns the Maguary and Dafruta brand, has been successfully integrated into the Britvic group and has delivered excellent results in the first year after completion, with revenue of £118 million representing growth of more than 18% on 2015.
The latest deal, for Bela Ischia, is expected to help Britvic realise ‘substantial cost savings’ and consolidate this activity in both RTD juices and concentrates.
Britvic chief executive officer Simon Litherland said: “The proposed acquisition of Bela Ischia represents an exciting opportunity to build on our very strong first year in Brazil with further expansion of our presence in a large and growing soft drinks market.
“Bela Ischia operates in a category where Britvic has proven capability of generating growth, launching new products and establishing brand leadership and is an excellent complementary fit with our existing business.
“Our due diligence to date has identified significant cost synergies and potential further revenue benefits arising from a broader brand portfolio and geographical presence. As a result, we are confident that this complementary acquisition should create a fantastic platform to consolidate our strategic position in Brazil and generate additional shareholder value over the coming years.”
It is anticipated, subject to closing conditions, that completion will occur at the latest by the end of March.
© FoodBev Media Ltd 2024