MBO may be on cards at Beamish
The Irish Competition Authority has asked for Heineken’s proposed partial takeover of Scottish & Newcastle& to be referred to it for investigation once the EU Commission’s competition division has concluded its initial review into the deal next month.
Heineken and Carlsberg reached agreement, earlier this year, to buy S&N, which owns Beamish & Crawford in Cork, for €10.5 billion.
As part of the deal, Heineken — which owns the Murphy’s Brewery in Cork — would buy most of S&Ns western EU operations, including the Irish business, which makes up an estimated 2% in market share terms of that region.
If the ICA decides to block the deal Heineken will be forced to resolve issues quickly and a management buyout of B&C& could prove the likeliest resolution. In the event of the ICA having no objections to the deal it is almost certain at least one of the Cork breweries will be closed, most likely B&C&. However, the relocation of both brewery operations out of the city could transpire.
A spokesperson for the ICA said yesterday the investigation would not solely be concerned with the potential change to the stout market here but would look at all aspects of Ireland’s beer market.
As well as Murphy’s Stout, Heineken distributes its eponymous lager, Amstel and Coors Light in Ireland. If the S&N takeover goes through, it would also take into its portfolio Beamish Stout, Strongbow Cider and the lager brands Kronenbourg 1664 and Fosters.
Any national competition authority looking to conduct an additional probe into mergers and acquisitions must wait until the EC has completed its preliminary review. The commission was to wrap up its review of the S&N takeover by March 18, but has extended that deadline until April 4. Speculation about what Heineken might do in the event of a positive takeover giving it control of both Murphy’s and Beamish in Ireland has raged for weeks — with everything from plant closures to a management buyout by Beamish mooted.
