EUROPE: Carlsberg, Heineken attempt to smooth S&N waves

By | 26 October 2007

Carlsberg and Heineken have defended their approach of Scottish & Newcastle as "a compelling proposition".

The two European brewers today (25 October) approached S&N's board with a proposal and a request to meet with S&N to discuss a possible offer. S&N has confirmed that it has rejected the proposal, for a cash offer of GBP7.20 per share, describing it as "unsolicited and derisory".

The Carlsberg and Heineken consortium said that the offer represented a premium of 36% to the share price of GBP5.31 on 28 March, when, the two claimed speculation first arose around a possible offer for S&N. The proposal also offered "a value which is significantly in excess of the standalone independent value of S&N", the European brewers said.

Carlsberg and Heineken also moved to qualify their announcement last week that they were in talks to break up S&N. "It has always been the strong preference of Carlsberg and Heineken to approach the board of S&N in private to explain the proposal in detail in order to secure due diligence access and negotiate a transaction on a recommended basis," the consortium said. "Due to the increase in S&N's share price on Wednesday 17 October, the consortium was obliged under the rules of the City Code on Takeovers and Mergers to publicly confirm its interest in pursuing an offer for S&N.

"Nevertheless, the consortium wishes to confirm its desire to pursue a transaction on a recommended basis."

Speaking to just-drinks earlier this week, when asked about the relationship between S&N Carlsberg, a spokesperson for S&N said: "There's no going back. We're pretty unhappy with our former partner.

"The way this has been handled (by Carlsberg) is entirely inappropriate. Their approach has been both incompetent and dishonourable."

Sectors: Beer & cider

Companies: S&N, Carlsberg, Heineken

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