Scottish & Newcastle

From Wikipedia, the free encyclopedia

(Redirected from Scottish and Newcastle)

This article needs additional citations for verification.
Please help improve this article by adding reliable references. Unsourced material may be challenged and removed. (November 2007)

Scottish & Newcastle

Type	Public (LSE:SCTN)
Founded	1749
Headquarters	Edinburgh, Scotland, UK
Key people	Sir Brian Stewart, Chairman John Dunsmore, Group Chief Executive John Nicolson, Managing Director, Developing Markets Ian McHoul, Finance & Strategy Director Alberto da Ponte, Managing Director, Sociedade Central de Cervejas Yrjo Narhinen, Managing Director, Oy Hartwall AB Stephen Glancey, Operations & Information Services Director Eleanor Cannon, Human Resources & Corporate Affairs Director Tim Seager, Managing Director, Brasseries Kronenbourg Jeremy Blood, Managing Director, S&N UK Peter Kennerley, Company Secretary Nuno Teles, Acting Marketing & Venture Markets Director
Industry	Beverages
Products	Beers, Lagers and Ciders
Revenue	£4,150 million (2007)
Operating income	£560 million (2007)
Net income	£(105) million (2007)
Employees	4,500
Subsidiaries	S&N UK; Brasseries Kronenbourg; Alken-Maes; Central de Cervejas; Hartwall; Mythos; Waverley TBS; Beamish & Crawford; S&N Pub Enterprises
Website	www.scottish-newcastle.com

Scottish & Newcastle (S&N) is one of the world’s leading "long alcoholic drinks" (LADs) companies with strong positions in 15 countries, including leadership in the UK, France and Russia. It is headquartered in Edinburgh, Scotland, UK, and is a FTSE 100 Index company. In the last 20 years, S&N has expanded significantly from its home base to become a major international business with beer volumes growing almost tenfold.

1 History
2 Pub Enterprises
3 BBH
4 Potential acquisition by the Carlsberg/Heineken consortium
5 Brands
6 References
7 External links

[edit] History

By 1985, the company had become a regional brewer focused on Scotland and the North of England, ranked number five in the UK and selling around 6 mhl per annum. By 1995, with the purchase of rival brewing business Courage, S&N had become the UK’s leading brewer, producing around 15 mhl per annum. Its UK brewing division became known as Scottish Courage but this reverted to "S&N UK" in Feb 2006. Its managed Pub division was known as "S&N Retail" with around 2,500 outlets in the estate. In early 2000, S&N expanded outside the UK via a number of acquisitions in Western Europe, growing sales to over 50 mhl per annum. In July 2003, S&N acquired the Bulmers cider business, adding the Strongbow, Scrumpy Jack and Woodpecker brands to its portfolio, together with the UK's biggest cider mill and orchards in Hereford.

2004 saw some radical cost cutting measures, particularly within the UK where it was noted by analysts that the cost base was too high. During the year, the Fountain Brewery in Edinburgh was closed, followed some months later by the Tyne Brewery in Newcastle.This was followed in 2005 by the closure of distribution depots based at Bow and Maidstone with the task being integrated into Dagenham and Croydon with the remainder of The City and West End Accounts being serviced by Greenford. Reciprocal acquisitions saw the Caledonian Brewery in Edinburgh and the Northern Clubs' Federation Brewery in Dunston added to the business.

By 2005, S&N had become a major European brewer with a balance of high growth emerging markets and high volume developed markets. Annual volumes are now approaching 60 mhl.

In February 2005, Scottish & Newcastle and Carlsberg UK finalised a joint venture to carry out Technical Services work in the UK. Service Dispense Equipment Limited (SDEL) was formed from the dispense assets of both businesses. This work is now contracted by the JV, to a new company Innserve Ltd. Innserve supplies, installs and maintains drinks dispense systems in 98,000 Pubs and bars around the UK.

In 2006, S&N entered into a joint venture with the Swiss based freight company, Kuehne and Nagel to set up a UK drinks distribution company (K+N Drinks Logistics). Some 2,000 S&N employees transferred to the new business.

[edit] Pub Enterprises

In 2002, S&N sold its remaining Pub estate to the Spirit Group - retaining a successful tenanted pub management business (S&N Pub Enterprises) with contracts to look after some 2,000 pubs on behalf of banks and other Pub companies.

[edit] BBH

By acquiring Hartwall, Finland’s leading beverage company business, S&N became 50% owners of Baltic Beverage Holdings (BBH) encompassing brewing interests in Russia, Ukraine, Kazakhstan and the Baltic Countries of Latvia, Lithuania and Estonia. The remaining 50% of the business is owned by Carlsberg.

[edit] Potential acquisition by the Carlsberg/Heineken consortium

On 17 October 2007, Heineken International and Carlsberg jointly announced that they were considering forming a consortium to bid for, and acquire the total capitalisation of Scottish & Newcastle. No formal offer had been put to S&N at the time and the bidding parties have yet to announce a timetable for the acquisition.^[1] On the 25 October, however, Heineken and Carlsberg announced that they had submitted a written proposal to S&N. They invited S&N to discuss a possible offer, the terms as to which they are prepared to proceed include a bid of 720 pence per share.^[2]

The offer was immediately rejected by the Board of S&N, who believed that it significantly undervalued the worth of the S&N group. Further developments are expected.^[3]

On the 31st October 2007, S&N announced that it had requested the Swedish Courts to begin arbitration proceedings between itself and Carlsberg A/S in relation to the latter's alleged contractual infringements, relating to the joint ownership of Baltic Beverages Holdings (BBH). Carlsberg immediately countered that it believed S&N's claims were "spurious and without merit". .^[4]

A new offer was made public on the 15th of November 2007 by Carlsberg and Heineken, raising the offer to 750 pence per share. (Thus being an increase of 30 pence per share) The partners claim this is "substantially in excess of the standalone independent value of S&N".^[5]

On the 17th January 2008, S&N announced that it was now in formal discussions with the consortium, following a revised proposal to purchase the business for £8.00 per share.^[6]

On 25th January 2008, following limited due diligence and discussions with S&N, the consortium announced a formal cash offer for the entire S&N business at £8.00 per share. This offer had the full support of the S&N Board and was recommended to shareholders. The transaction is expected to complete by June 2008.^[7]