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Drink maker Frucor Beverages has agreed to buy the Spring Valley sale and distribution systems from Australia's Bonlac Foods.

Frucor said it would pay Bonlac $A1 million ($1.29 million) and assume some lease liabilities related to Spring Valley sales and distribution.

Frucor managing director Mark Cowsill said that would result in slightly higher costs for its businesses in Australia in the short term.

Bonlac announced last week that it was selling its Spring Valley juice and Wave dairy beverage brands to Cadbury Schweppes. Spring Valley was the distributor of Frucor's V energy drink.

Frucor shares last traded down 1c at $1.77.

The agreement was subject to the successful conclusion of the Bonlac/Cadbury deal, due to close on December 31.

Frucor recorded a net profit of $9.6 million for the year to June 2000.

It markets the brands V, Fresh-Up, Just Juice and H2GO.