THE UK’S trade watchdog has put the brakes on the merger of soft drink giants Britvic and AG Barr after extending the timetable for its probe into the deal.
The Office of Fair Trading has put back a decision to green light the merger until the 13 February, giving it more time to scrutinise whether the merged entity, Barr Britvic Soft Drinks, will create a monopoly in the industry.
The £1.4bn deal, which was struck in November giving Britvic shareholders 0.8 Barr shares for every Britvic share, was due to be signed off on 30 January.
The OFT probe will examine whether the tie-up will lead to a substantial lessening of competition in the UK’s soft drink sector.
Barr makes iconic Scottish tonic Irn Bru, while Britvic is behind some of the UK’s best known brands, including Tango and Robinson Fruit Shoots.
The watchdog could refer the deal to the Competition Commission if it decides the merger will weaken competition in the sector.
This would delay the deal for a further six months.
An OFT spokesman said it was “not uncommon” for the body to extend its deadline and stakeholders should not infer too much from the delay.
Britvic shares finished flat in trading yesterday.