GSK to sell global drinks brands
Private equity funds are circling as a billion-pound bidding war has broken out in Britain for GlaxoSmithKline’s Lucozade and Ribena global drink brands.
Sources suggest one potential scenario could see Blackstone team up with Lion Capital, with ex-Barcadi boss Javier Ferrán taking the role of chairman.
The two firms worked together on the buyout of Orangina before selling the company to Japan’s Suntory in a €2.6 billion ($4.1 billion) deal.
Private equity giants Permira, KKR, Bain and CVC are also expected to have an interest.
However, UK drinks-maker Britvic, which has been tipped as the most likely bidder, is thought to be constrained by the likely price tag – as well as potential competition issues.
Other potential suitors include Japan’s Suntory and Nestlé.
In February, GSK chief executive Andrew Witty signalled the sale, saying the brands’ combined sales were £600 million ($1.1 billion) but were “poles apart” from the core strategy of GSK’s £26 billion pharmaceuticals empire.
Nielsen says Lucozade is the second-biggest soft drinks brand in the UK, with two-thirds of its sales homegrown and the rest coming from Nigeria, Singapore and a fledgling business in China.
In New Zealand, Lucozade is sold in three flavours, while Ribena is the largest-selling blackcurrant drink. GSK also supplies Horlicks to the local market.
GSK has not yet appointed an investment bank to run the auction but insiders suggest consumer rainmaker Blair Effron at boutique bank Centreview is the most likely choice.
A GSK spokesperson says: “We are reviewing all strategic options for the Lucozade and Ribena drinks brands. This review is ongoing, all options are on the table and no decision have been taken at this time.”