A DRAMATIC twist in the tale of the takeover of Scottish & Newcastle came yesterday when rival SAB Miller confirmed it had considered – but walked away from – a rival bid to the recommended £7.8bn offer from the Carlsberg/Heineken consortium.
SAB issued a statement after the stock market closed last night saying that "consistent with its normal practice of evaluating all strategic opportunities" it had run the rule over S&N's business.
It said it had acted after extra information w
as published by S&N and the consortium on the performance and prospects of Baltic Beverages Holding, the joint venture between S&N and Carlsberg, at the time of the recommended 800p-per-share offer in January.
However, SAB said that, after a preliminary evaluation, it "decided not to take further action with regard to Scottish & Newcastle".
Earlier in the day rumours swept the market that the South African brewer was about to strike and derail the consortium offer with a rival bid of up to 850p a share.
Shares in S&N, which reported flat annual pre-tax profits of £444 million on Tuesday, rose 19.5p to 807.5p on the speculation. SABMiller's fell 49p, or 4.3 per cent, to 1,082p.
However, analysts had been sceptical of an 11th-hour intervention from SAB even though it had made no secret that it was interested in S&N, mainly for the BBH Russian business. SAB also has a Russian business. BBH is the fastest-growing part of S&N, and on Tuesday it was revealed that BBH's profits leapt 43 per cent to £211m last year.
Elaine Coverley, drinks analyst at Brewin Dolphin, said: "This (a late SAB bid] would be an interesting development if true, but a price of 850p a share looks a bit rich."
Under the consortium's offer, Carlsberg is set to gain full control of BBH, as well as S&N's French and Greek operations.
Heinken stands to take S&N's UK arm, where operating profits fell nearly 8 per cent to £213m in 2007, hit by last summer's poor weather and the smoking ban being extended from Scotland to England and Wales. SAB was thought to be uninterested in S&N's western European business.
Sam Hart, drinks specialist at broker Charles Stanley, said: "A mooted 850p a share always looked very high as many in the City considered the 800p finally offered by the consortium as a pretty full price. 850p would have been an exceptionally full price."
• Heineken yesterday reported a 33 per cent fall in pre-tax profit to 807m, and warned it faced material price increases of 15 per cent this year, which would prompt it to raise its prices by an average of 4 per cent.
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