Cadbury Schweppes expected to delay US soft drinks spin-off

Dr Pepper launched an advertising campaign in 2004 with the slogan "What's the worst that could happen?" showing those that tried the soft drink for the first time suffering a series of hilarious calamities.

The jokey tagline may have come back to haunt the Dr Pepper-owner Cadbury Schweppes, after an analyst said plans to divest its US soft drink business might be derailed yet again.

Simon Marshall-Lockyer, a research analyst at the US banking group Bear Stearns, said: "Following a further deterioration in the debt markets, we believe there is now at least a 50/50 risk that Cadbury Schweppes might postpone the separation of its US Beverages business."

The spin-off was supposed to complete by June, but Mr Marshall-Lockyer said he believed this was by no means certain.

Cadburys declined to comment yesterday.

Mr Marshall-Lockyer said that, despite the difficulties, the management remained focused on the separation of the businesses "and confirms that alternatives beyond postponement are not currently considered viable".

In October, the confectioner pulled the proposed sale and announced plans to spin off the business and list it in New York, under the name of Dr Pepper Snapple Group, reflecting two of its premium soft drink brands.

Last month it disappointed investors, including the activist Nelson Peltz, when it said there would be no special payout following the demerger.

Following the group's results meeting two weeks ago, the chief financial officer Ken Hannah said the state of the credit markets meant Cadburys was unable to refinance the US division's balance sheet. He has indicated that, should this not be completed by the end of March, the company "might have to reconsider the separation of the business until credit markets improved", according to Mr Marshall-Lockyer.