LONDON - The British beverage company Britvic agreed on Wednesday to an all-share merger with a rival British maker of soft drink A.G. Barr in a deal worth around $2.3 billion.
Under the terms of the deal, shareholders in Britvic will own a 63 percent stake in the combined company, while A.G. Barr's investors will retain a 37 percent holding.
The merged company, whose brands include Robinsons fruit drinks and the license to distribute several Pepsi products in Britain, will have annual revenue of £1.5 billion, or $2.4 billion, making it one of Europe's largest soft drink makers.
Britvic and A.G. Barr, which had been in discussions since September, said the deal would help them to increase their market share in the British beverage market, while allowing them to expand internationally, particularly in the United States and France.
“The merger of A.G. Barr and Britvic will create a world class soft drink company,†Britvic's chairman, Gerald Corbett, said in a statement. “The combination makes huge commercial and industrial sense.â€
Shares in Britvic rose 2.6 percent in morning trading in London, while stock in A.G. Barr increased 3.5 percent. The companies have a combined market capitalization of £1.4 billion.
As part of the deal, the companies said they would hoped to achieve up to £40 million of yearly cost savings by 2016.
Roger White, A.G. Barr's chief executive, will lead the merged company and Britvic's chief financial officer, John Gibney, will continue that role in the expanded drink maker, according to a company statement.
Citigroup and Nomura advised Britvic on the deal, while Rothschild advised A.G. Barr.
