A near-£1billion deal putting Scottish soft drink business Cott Macduff under new ownership is being probed by the UK’s competition watchdog.
The Competition and Markets Authority (CMA) warned yesterday the £935million takeover by Dutch company Refresco of Cott’s global beverage manufacturing business could lead to “higher prices for some supermarkets and leading household brands”.
Competition concerns are focused on an unusual production process which allows drinks to be sold preservative-free and without refrigeration.
“Only one other competitor in the UK currently supplies third parties with juice drinks using this production process,” the watchdog said, adding: “The CMA is, therefore, concerned that after the merger the combined business might be able to increase prices or lower quality standards.”
The CMA will refer the merger for an in-depth investigation unless Refresco offers acceptable undertakings to address the concerns.
Rotterdam-based Refresco said it was studying the details of the decision but willing to offer “suitable” remedies. It also said it would “fully co-operate with the CMA to address the concerns raised”.
Florida-headquartered Cott Beverages is selling Cott Macduff, previously Sangs, along with other Cott UK beverage manufacturing businesses and some US and international operations to Refresco.
Cott acquired Sangs – the Aberdeenshire firm behind the macb range of still and sparkling flavoured water, as well as the recently axed Moray Cup fizzy drink – in March 2012, rescuing it from administration.