Cadbury Schweppes PLC has agreed to sell its European beverages arm for 1.85 billion euros (1.27 billion pounds -- $2.2 billion) to a private equity consortium led by Blackstone Group and Lion Capital LLP.

The maker of Dr Pepper soft drinks, Dairy Milk chocolate and Dentyne gum will use the money to reduce its 4.3 billion pound ($7.4 billion) debt mountain and focus on faster growing businesses, such as its global confectionary arm and U.S. soft drinks division.

“I am delighted that within such a short time we have achieved a firm offer at a price which reflects the quality of its brands and the strength of its management team,” chief executive Tood Stitzer said in a statement.

Financial analysts said the price fetched was broadly in line with expectations after the business was put up for sale in September.

The unit, which makes brands such as Schweppes, Oasis and Orangina, generated underlying operating profit of 116 million pounds ($201 million) in 2004 on revenues of 653 million pounds ($1.13 billion). It had net assets of 644 million pounds ($1.11 billion) as of January 2.

Cadbury said that, in the event it does not accept the binding offer, it has agreed to pay a termination fee equivalent to 5% of the deal's value.

The transaction, which is conditional on European Union approval, is expected to complete early next year.