Update, October 2026: Britvic is no longer listed on the stock market. Danish brewer Carlsberg completed its £3.3 billion takeover in January 2025 and combined it with its UK business to form Carlsberg Britvic. Shareholders received 1,315p a share in total (1,290p in cash plus a 25p special dividend). That’s more than double the 600p we paid in 2016, before counting the dividends we received along the way. The original article follows.
This article is our personal view and not a recommendation to buy any share. When investing, your capital is at risk. Past performance is not a guide to future performance.
Invest in what you know
Investing doesn’t need to be complicated. Often, the simpler you keep it, the better. Two of the greatest investors of recent times, Warren Buffett and Peter Lynch, have both advised investing in companies whose products you know, use and like.
Businesses with strong brands and loyal customers tend to make high profits year after year. Think of Coca-Cola, PepsiCo, Hershey and Nestlé. They aren’t fashionable or cutting edge, but these “boring” companies have delivered strong returns for decades, because customers keep buying their products.
Why we liked Britvic
One company that caught our eye for its popular products and loyal customers was Britvic. It made, distributed or licensed brands such as Pepsi, Tango, Mountain Dew, Robinsons (including Fruit Shoot), 7UP, J2O and Teisseire.
People across the UK enjoy these drinks, and we expected them to keep doing so for decades. For a company that owns and licenses brands like these, that’s a strong basis for a long-term investment.
Our purchase in 2016
After the Brexit vote in June 2016, shares in UK-focused companies, and especially consumer cyclical companies, fell sharply. Consumer cyclical companies sell things people can choose not to buy, so they suffer when the economy weakens.
Britvic was different. As a consumer staples business, its sales don’t depend much on the economy. People don’t stop buying soft drinks and squash because a recession is coming. In our view, the sell-off in Britvic shares after the referendum was overdone and created a buying opportunity.
We bought 186 shares at 600p each, a total of £1,116. That put the shares on a P/E ratio of 13, cheap for a defensive company, with a dividend yield of 3.8%. We expected about £43 in dividends over the following year.
Britvic had been raising its dividend steadily. If that continued, we expected to receive around £274 in dividends over five years, about 25% of what we paid.
How it turned out
In 2024, Carlsberg agreed to buy Britvic. When the deal completed in January 2025, each share was worth 1,315p, including a 25p special dividend. Our 186 shares, bought for £1,116, were worth about £2,446, plus all the dividends received over the years.
As Peter Lynch said, one of the most profitable ways to invest is to invest in what you know. Strong brands that people enjoy tend to last. That makes their cash flows easier to predict and the business easier to value. It’s also why a company like Britvic attracted a takeover bid from a larger rival.
Disclaimer: This article reflects the author’s opinion and holdings at the time of writing. It is not a recommendation to buy or sell any share.
Pedro is passionate about finance, marketing, and technology. He is a growth manager at several online projects and a former digital marketer for a fintech company.
