Bass may use Burton to meet extra demand

Bass may look at increasing production of Caffrey's and leading ale brands through the acquisition of Carlsberg-Tetley's (C-T) Burton brewery.

Last week C-T announced that Burton would close if it could not be sold.

Bass immediately confirmed its interest and talks will begin shortly over a price.

The brewer had already recognised the need for increased capacity to cope with anticipated increases in demand for Caffrey's, Bass Draught and Worthington.

It claims to have made plans for increased capacity in any case and will not want to appear vulnerable in its negotiations over Burton.

The Bass ale brands are currently experiencing annual sales increases of five per cent.

If Bass decides not to buy Burton, the brewery will close by April 1999 unless an alternative buyer is found.

C-T said it would retain and invest in its Northampton and Leeds breweries.

Finding buyers for its Alloa and Wrexham breweries will not be so easy. But unless this is done, Alloa will close by May next year and Wrexham will follow in October 1999.

The rationalisation will further cut over-capacity in the industry and is the latest and biggest in a series of blows to the brewing industry this year.

These have included the departure of Gibbs Mew and Eldridge Pope from brewing and the axing by Whitbread of nine once-popular cask ale brands.

About 1,450 jobs are to go in all as a result of C-T's rationalisation programme (see box).

But the figure may eventually be reduced to as few as 700. Of the 330 distribution jobs to go, 100 are to be contracted out. The three breweries may eventually be bought — although even if they are, rationalisation of some kind remains likely.

And unions are in talks with C-T to minimise the scale of the job cuts.