UK: Analysts say Scottish & Newcastle vulnerable to takeover
The UK's second largest brewer Scottish & Newcastle, the last of the big British brewers to be still under home control, could be vulnerable to a takeover.According to Dow Jones International News, analysts believe that the brewer lacks the cashflow to aggressively expand its international operations. Its domestic prospects are also bleak, observers have told the news service.Scottish & Newcastle's results, released yesterday, were in line with market expectations, with pre-tax profits of £415m. However due to confusion over new accounting standards, some forecasts were high and led to a sharp fall in the company's share price."If S&N's share price continues to drift at this level, then a potential takeout is possible," said an analyst.Observers have picked out South African Breweries (SAB) as the only real contender for the business."Only SAB looks to have the motivation and cash to do it," said the analyst. The article went on to say that S&N's Kronenbourg acquisition will only serve to make the group more attractive to a predator. S&N's home market also looks tough in the wake of Interbrew's aggressive entry.Analysts said that S&N's John Smith's, Foster's, Kronenbourg and Miller's brands weren't likely to be a match for Interbrew's Carling, Stella Artois and Worthington brands.However Merrill Lynch said in a recent note that the acquisition of Kronenbourg and Greenalls pub estate should double S&N's growth rate over the next two years.
Get full access to all content, just $1 for 30 days
A Message From The Editor
just-drinks gives you the widest beverage market coverage.
Paid just-drinks members have unlimited access to all our exclusive content - including 17 years of archives.
I am so confident you will love complete access to our content that today I can offer you 30 days access for $1.
It’s our best ever membership offer – just for you.
Olly Wehring, editor of just-drinks
- Interview - Pernod Ricard's luxury director
- What's coming up in wine in 2017? - Comment
- Chile's winemakers caught out by Brexit "disease"
- The just-drinks Analyst - 2017 forecasts
- What's coming up in beer in 2017? - Comment
- Diageo Australia names new commercial head
- Suntory sends staff to fat camp - report
- "Beer and weed are complements" - analyst
- Pernod Ricard's Absolut Lime - NPD
- Edrington readies Americas, GTR exec switches
- Global vodka insights - market forecasts, product innovation and consumer trends
- The Next Seven Big Beverage Markets
- Global Cognac insights - market forecasts, product innovation and consumer trends
- Global gin insights - market forecasts, product innovation and consumer trends
- Darker Than Before: Global Prospects for Brown Spirits