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Cadbury nears £419m purchase of Orangina

Susie Mesure
Thursday 07 June 2001 19:38 BST
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Cadbury Schweppes is close to wrapping up a nine-month campaign to buy Orangina, the French soft drink brand, from Pernod Ricard for 700m euros (£419m).

The deal covers Pernod Ricard's entire non-alcoholic beverages portfolio ­ including the chocolate drink Yoo-Hoo and the Pampryl fruit-juice business ­ across continental Europe, North America and Australia. It will double Cadbury Schweppes' French market share to 19 per cent.

David Kappler, chief financial officer at Cadbury Schweppes, said yesterday that the transaction was unlikely to be closed before September.

Under French law, as a formality, Orangina's workers must be consulted before their company is signed away. The deal is also subject to approval from European Union regulators. In 1999, the French government refused to approve Pernod's planned sale of Orangina to Coca-Cola, citing competition concerns.

Pernod Ricard said it did not expect any problems this time.

Mr Kappler said: "The deal will improve our distribution in France, particularly though smaller impulse outlets like hotels, cafes and restaurants where the Orangina system is strong." At present, he said, the company relies mainly on supermarket sales for its Schweppes and Oasis drinks.

Analysts said the UK maker of Dairy Milk chocolate and Dr Pepper soft drinks had agreed a good price with Pernod Ricard. Julian Hardwick, at ABN Amro, said: "Coca-Cola offered a similar price two years ago for a business that was half the size that Cadbury is acquiring."

Cadbury Schweppes' shares closed up 1.5p at 463.5p.

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