S&N warns Carlsberg over BBH

24 October, 2007

Scottish & Newcastle has warned Carlsberg, its joint venture partner in Baltic Beverages Holdings, that it believes it has broken the terms of the BBH shareholders agreement.

The move, which could see the UK and Danish brewers go to court, comes as S&N tries to fight off a joint takeover bid by Carlsberg and Dutch brewer Heineken. Last week, Carlsberg and Heineken were forced to admit they were in talks to buy and carve up S&N - the UK's only major independent brewer - after details were leaked to the press. S&N called the proposal “unsolicited and unwelcome”.

City analysts and commentators have said that Carlsberg’s main motivation is a desire to control BBH, which owns Russia’s best-selling beer brand Baltika. In a statement issued today, S&N’s board said that after taking legal advice, it considered Carlsberg’s actions to constitute the start of a termination of the BBH partnership agreement “under which Carlsberg is obliged to offer its shares in BBH to S&N”.

It added: “The board is still evaluating whether the best interests of S&N shareholders will ultimately be served by outright ownership of BBH or through the introduction of a new partner(s) into BBH.”

Carlsberg confirmed it had received the letter and said it believes "the claims made have no merit".

S&N and Carlsberg have been partners in BBH since 2002.




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