Interbrew's disposal of Carling Brewers means some of Britain's best selling brands are up for grabs. Kerry Rogan looks at how this will affect the trade
After more than a year of legal wrangling, a decision has finally been made on Interbrew's £2.3bn takeover bid for Bass Brewers.
When trade and industry secretary Patricia Hewitt announced the Government's decision last week, it ended 15 months of speculation.
She told Interbrew to sell either Bass Brewers or Carling Brewers, and unsurprisingly, later the same day the Belgian brewing giant confirmed it will dispose of Carling, before the Government's deadline of February 2002.
The decision means Interbrew will keep the businesses of Bass Brewers in Scotland and Northern Ireland, together with the breweries at Glasgow and Belfast and the Tennent's and Bass Ale brands.
The remainder of the Bass Brewers UK business, including the Carling brand and the Scottish element of Bass Brewers' on-trade national account customers, will be sold.
"I have accepted the further advice of the director general of fair trading (DGFT) that the adverse effects of this merger can be remedied by the divestment to a buyer approved by the DGFT either of Bass Brewers or of the businesses and assets known as Carling Brewers," said Ms Hewitt.
Already potential buyers for Carling are emerging.
Heineken and Anheuser-Busch are said to be the top contenders in the war for the brand when it is put on the market later this year, although analysts say South African Breweries is also in the running.
The road will not be easy for any buyer, however, who will have to be approved by the Government before a sale goes through.
While big companies are getting ready to step into the gap left by the sale, the repercussions of the decision for the industry remain to be seen.
Many trade leaders welcomed Ms Hewitt's announcement, but others fear the effect it will have on cask ale and in fact, the pub trade as a whole.
The Association of Licensed Multiple Retailers (ALMR) has made it clear that it has always supported, and continues to support, the Bass Brewers remedy.
"The crucial thing now will be to assess which of the potential buyers of either the brands or the business will provide a competitive market place for licensed retailers," a statement from the ALMR said.
When the takeover bid was first announced, the Independent Family Brewers of Britain warned: "Within a few years it could be the exception rather than the rule to find a pub that offers traditional draught beer."
Some experts believe the Government's decision does not go far enough. Iain Loe, spokesman for the Campaign for Real Ale, said he thought important questions, such as the future of the Bass museum in Burton, were left unanswered by Ms Hewitt's statement.
He also pointed out that the sale of Carling will probably mean the sale of Bass breweries at Alton in Hampshire, Tadcaster, Birmingham and Burton, while Interbrew retains the breweries in Ulster and Glasgow's Wellpark.
"Caffreys is brewed at Ulster and the brand is being sold, while Bass Ale is brewed at Burton and that brewery will be sold," he said. "I'd like to know what that will mean."
CAMRA intends to ask Interbrew for a meeting to determine its plans.
Not surprisingly Interbrew has welcomed the decision, which leaves it with a 15 per cent share of the UK market. The Bass Brewers remedy would have left it with 10 per cent.
"We are pleased with the decision, which clears the way for us to strengthen our UK platform as well as our international portfolio," said Hugo Powell, chief executive of Interbrew.
The repercussions for the pub trade are yet to be seen. Who buys the package and what they and Interbrew decide to do with some of Britain's best selling brands could have wide-reaching implications, but for now it is just a case of watching and waiting.
Bass and Interbrew - the story so far....
Bass facts
- Bass Ale was first brewed in Burton-on-Trent by William Bass in 1777 making it one of Britain's oldest brands.
- In 1913 Picasso painted the Bass bottle and since then it has featured in more than 30 paintings.
- Buffalo Bill, aka William Cody, is reputed to always have taken a bottle of Bass with him when he went hunting.
- 12,000 bottles of Bass were reported to have been found among the wreckage of the Titani