Scottish & Newcastle contemplating BBH sale

Last week, European brewers Carlsberg and Heineken, put in a takeover bid for Scottish & Newcastle (S&N) but the group rejected it saying the break-up bid was “unsolicited and unwelcome”.

It has now come to light that S&N may sell its stake in Baltic Beverages Holding (BBH), the Russian brewer in a bid to block the bid from Carlsberg and Heineken.

S&N is the sixth largest brewer in the world and is the country’s last big independent brewer and it has been a takeover target for many years. Carlsberg, which is the world’s fifth largest brewer, is considered the most likely suitor owing to its joint ownership with S&N of the rapidly expanding BBH.

However, the news is that S&N is looking at all options, one of them selling its stake in BBH, which Carlsberg wants to take over via its joint bid with Heineken. Heineken, which is the world’s fourth largest brewer, aims to take control of S&N’s British business including John Smith’s beer, Strongbow cider and its other European divisions including Belgium, Finland and Portugal.

BBH is seen as the most prized possession in S&N as it controls over 85% of Baltika, the biggest brewer in the world’s third largest beer market, Russia. Furthermore, it provides over 30% of S&N’s and Carlsberg’s group earnings.

Other reports in the press state that Carlsberg and Heineken are urging to get a proposal this week. Analysts are speculating that this would be approximately 800 pence per share in cash and value the group at £7.6 billion.

Story link: Scottish & Newcastle contemplating BBH sale