Olly Wehring

S&N and Carlsberg - who's fanning the flames?

By: Olly Wehring - 22 February 2006 15:51

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What would our lives be like, as journalists, without rumour or speculation? Certainly, it would be a great deal quieter, and probably a tad duller as well. Sometimes, however, one can’t help feeling that one’s been here before, as M&A talk begins to repeat itself over and over again.

Much as I’d love the job of sitting in a darkened room making some of this stuff up, I can assure you that we here at just-drinks are not in the pot-stirring business. We’re proud to tell you what’s what in the drinks world, and leave the tittle-tattle to journos with more time on their hands.

Although…

Speculation over a possible permanent get-together between Scottish & Newcastle and Carlsberg has been around for quite some time now. And every time one of them hits the headlines, it seems the talk gets louder. Indeed, with the two of them working so well together in their Eastern European enterprise, Baltic Beverages Holding, to many it looks like a match made in heaven.

Add to this the fact that, in the last few days, S&N has confirmed that it is looking to close one of its Kronenbourg breweries in France, while Carlsberg will shut its plant in Valby, near Copenhagen, in 2008, and you will understand why some see it as a case of when and not if.

Speaking to just-drinks yesterday (21 February), S&N’s CEO, Tony Froggatt, trotted out a phrase he feels he must say almost daily: “From our point of view, we are very happy with the relationship that we have with Carlsberg right now.” With S&N’s UK operating profit last year rising by an impressive 10.2%, it’s understandable why Froggatt was smiling when fielding our question.

“I’m not sure where these rumours come from,” he added. “They’ve been popping up for years.”

Speaking to the Danish press today, Carlsberg chairman Povl Krogsgaard-Larsen also trashed the talk: “If one can buy Carlsberg? The answer is no. Neither are there thoughts of a merger or merger possibilities.

“The one Carlsberg that is for sale is our beer.”

Of course, the rule of thumb has always been that there’s no smoke without fire – in this instance, however, we could all eventually end up very cold.

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