AG BARR, manufacturer of Irn-Bru, is unlikely to risk its successful business model by moving its headquarters south of the Border if it pulls off a deal to merge with Robinsons owner Britvic, a City analyst has predicted.
The Cumbernauld-based company saw its share price increase by 7% yesterday, a day after revealing it had initiated talks with its larger drinks rival on a scheme that would see its chief executive Roger White installed as chief executive of the combined group.
Its closing share price of 481.6p is an all-time high and means that AG Barr's market value has risen by £77.8 million to £562.4m this week.
Britvic, which makes popular soft drinks including Tango and J20, recently moved from Essex to Hertfordshire.
The two companies have not yet said where they intend to locate their combined headquarters, but Wayne Brown, analyst at Canaccord Genuity said: "AG Barr will not change its business model.
"We will have AG Barr located in Cumbernauld and Britvic in England."
He said it is likely that functions such as procurement are merged while their brands continue to be managed separately.
He added: "I do not think there will necessarily be structural changes to the degree the whole business will move south."
Meanwhile, Phil Carroll, analyst at Shore Capital, said by combining with Britvic, AG Barr's valuation is likely to fall, making the combined group an attractive takeover target.
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