E-Malt.com News article: 3365

UK: Britain's Office of Fair Trading (OFT) on Wednesday, September 29 referred to anti-trust regulators a deal in which U.S.-based brewer Adolph Coors Co. agreed to sell its beer dispensing equipment in UK pubs to a new company, according to Reuters.

In August, the brewer agreed that the new group, called Service Dispense Equipment, would buy its beer tap equipment in pubs and other outlets and provide maintenance and other services for the brewer in the UK under a 10-year outsourcing agreement. The new company would be jointly owned by three of Britain's four national brewers -- Coors, Scottish & Newcastle and Carlsberg UK. An initial deal between S&N and Carlsberg was cleared by the OFT in March this year.

Industry sources said the agreement between the three brewers had attracted the attention of the regulators as the three groups brew nearly 60 percent of Britain's beer.

The Coors deal will now be examined by Britain's Competition Commission. The only one of Britain's four big brewers outside the deal is InBev, with a UK beer market share of nearly 20 %.

Last month Golden, Colorado-based Coors said it expected the deal to result in a one-time tax benefit of about $36 million, increase 2004 net income by about $4 million, and save more than $5 million a year. It expected the agreement and other costs to hurt Europe results by about $32 million in 2004's second half.


01 October, 2004