S&N Knock Back Further Approach

British independent brewery group Scottish & Newcastle has today rejected a higher offer from giants Carlsberg and Heineken in their battle to takeover the manufacturer of Fosters and John Smiths.

The higher 780p per share offer, rejected again by the board of directors, was proposed in order to acquire the group after earlier offers had failed to secure the blessing of the board. However after a prompt from the Takeover Panel to make their next move, Heineken and Carlsberg in consortium were forced to launch the bid knocked back today.

However the situation may not be far from conclusion, with Scottish & Newcastle suggesting for the first time that they would be willing to listen to offers in the region of £8.00 per share. The group rejected an earlier approach of 750p per share as wholly “unacceptable”, citing its numerous strategic holdings as justification for a higher offer.

Amongst its most notable holdings is the group’s stake in Russian brewery BBH, which has been identified as a key player in the booming Russian beverage market. However with Carlsberg also holding a 50% stake in the same company, it may seem that the takeover bids are designed to allow Carlsberg to consolidate its holding.

Should their next bid prove successful, the business of Scottish & Newcastle will be divided between the two major breweries, giving Carlsberg full control of BBH and enabling Heineken to take control of certain of its European distribution networks.

It remains to be seen whether we will see a further offer tabled by the consortium, who have been publicly interested in purchasing Scottish & Newcastle for some time.

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