Six Continents goes soft on Britvic

Six Continents is to put the soft drinks business Britvic back up for sale once it has completed the demerger of its pubs and hotels.

The business, thought to be worth £500m, is jointly owned by Six Continents and Whitbread, Allied Domecq and the UK arm of Pepsi.

The demerger, due to complete in April, will see its Britvic ownership go with the hotels business. But Six Continents, the biggest shareholder, is keen to sell as soon as possible.

Richard North, the current finance director who will head up the newly formed hotels group after the demerger, is also chairman of Britvic.

"The board have put it in the hotels because Richard North is chairman and he knows the business," said one analyst close to the company.

"But it will go - why would they keep two hotels businesses and a soft drinks group?"

The drinks business contributes more than £30m a year to Six Continents group profits. In addition to making a number of British brands such as Robinsons, R Whites and Tango, Britvic is also responsible for the UK bottling of joint-owner Pepsi.

Pepsi are not thought to be interested in buying the business outright but could block any possible bids.

The cola manufacturer is understood to be reluctant to let its UK interests fall into the hands of venture capitalists.According to analysts, the business had been up for sale, on and off, for the last three years.

Last year the joint owners were in talks with private equity groups Cinven and CVC, as well as Pepsi Bottling Group, the largest bottler of Pepsi.

It is understood that although Allied, Six Continents and Whitbread were keen to accept the tabled bid Pepsi refused to accept the bids. The business was withdrawn from the market.

The part ownership of Britvic sits awkwardly with the Six Continents portfolio, a fact that will be even more pronounced after the pubs and hotels split.

Allied Domecq is now focused on spirits and wine and Whitbread has transformed itself into a leisure group with interests in fitness clubs, hotels and restaurants.

The Britvic Ownership​

The ownership structure of Britvic is not straight forward.

The parent company, Britannia Soft Drinks, is owned jointly by Six Continents (51 per cent), Allied Domecq (24.5 per cent), and Whitbread (24.5 per cent).

Britannia Soft Drinks owns 90 per cent of Britvic Soft Drinks. The other 10 per cent of Britvic is owned by Pepsi Co, the UK arm of Pepsi.