As S&N have now sold off their pub estate, theres a great chance that they will become a takeover bid.
This share could rise substantially soon.
What does everyone else think?

Ah - the magic words, brokers forcasts. What I want to know is the companies intentions.

LW - No I haven't...will check out croc's charts - It's been a good couple of days on the market nice to see those prices on the rise!!
BB - Ah well lets hope they do not rebase it too low of the current mark!

The Board's intention is that, following the final dividend for the year ended 27 April 2003 the total full year dividend will be re-based to a level approximately one third lower than the total full year dividend for the year ending April 2003.

From the chairmans statement in the 2003 annual report:

DIVIDEND POLICY

Following the transactions discussed above the Group will become an international brewer with a considerably different cash flow, capital expenditure profile and earnings base. Your Board has therfore reviewed the current dividend policy and has decided to commend a re-basing of the dividend to an appropriate level for the requirements of the business in its new shape.

Your Board's intention is that, following the final dividend for the year ended 27 April 2003, the total full year dividend will be re-based to a level approximately one third lower than the total full year dividend fot the year ended 27 April 2003.

Given our inteion to move to a December year end, the next dividend due to be paid will be in respect of the eight month perios from end April to Deember 2003. To be paid after the AGM in APril 2004, the dividend will be set on a pro-rata basis (ie two thirds of a full year) and will reflect the re-basing described above.

So there you have it (do you think this was written by an accountant?)

Sorry Brianboru I had to write the whole thing out

Many words to say a small thing - yes quite possibly written by an accountant! Sorry immediately to any in the accounting profession, it's just an observation.

I'm looking to trade this one in future between 350'ish (buy) and 383'ish (sell). Hopefully, if I can pick up the divi and trade a couple of times I'd be looking at 25% over a year. That's the plan, as for whether it works or not is in the lap of the Gods and the not too well thought of board of directors.

S&N at last have broken 400p mark. Looking at chart, should rise up to 450p at least.

There is talk of a takeover at S&N possibly from Diageo. And of S&N closing down 2 breweries which will save 25M for each brewery.

Source:- Sunday Herald

McEwan’s Lager ‘dead within 18 months’

By Ian Fraser and Julia Fields

McEwan’s Lager, once a serious challenger to market leading Tennent’s will be “dead within 18 months”, according to sources at rival brewers.
Mike Lees, managing director of Tennent Caledonian Breweries, said: “That [McEwan’s Lager] will not be on the market in 18 months.

“It is dead. They’ve been cannibalising it [with Miller] – and the take home trade don’t sell it any more.”

McEwan’s sponsored Rangers in a ten-year, 1 million plus, shirt sponsorship throughout the 1990s, a move which could have alienated potential drinkers from rival clubs, such as Celtic.

Lees conceded that McEwan’s was viewed as a serious challenger to Interbrew-owned Tennent’s – which today commands a 50.1% share of the Scottish lager market – as recently as the mid-1990s. But latest market data from Neilsen shows McEwan’s share of on-trade lager sales has collapsed from 6.7% in 2001 to just 2.6%.

“Two year’s ago they [S&N] had 20.3% of the Scottish lager market,” said Lees. “They’ve now got 15.6%, so they’ve lost a 5% share in two years – and that’s the growth part of the market.”

One industry observer added: “McEwan’s Lager had a real chance to take on Tennent’s as recently as 1995. But then S&N switched their attention to Miller and tried to build that up.

“Now, since they only have the rights to Miller for another five to six years, they’re about to have a go with Foster’s. But all this jumping about is playing havoc with their position in the market.”

Meanwhile, S&N has selected a preferred bidder for the disposal of land worth more than 25m next to its Fountain Brewery in Edinburgh.

The company will undertake detailed negotiations with London-based developers Grosvenor, which intends to build offices and housing on the eight-acre site.

The property, the site of S&N’s former kegging facility, has been sought after by developers. Over 15 parties submitted bids before the list was whittled down to Scarborough, Cala, Highland Properties, Grosvenor and Edinburgh-based consortium Deanway.

However a spokesman for S&N denied there is any intention to shut down the Fountain Brewery and transfer production to its four breweries in England.

“The brewery works fine and it is a key part of our network. But the business is looking at ways to improve operating efficiencies right across Europe.”

This weekend there is renewed speculation that S&N may be a bid target, with SABMiller replacing last week’s Diageo as the Edinburgh-based firm’s most likely suitor.

01 February 2004

ScotInvestor - thanks for posting this.
Bid speculation may be useful for the share price!

(Source: Scotland on Sunday)

Brewing up a takeover storm at S&N

Shares have surged amid talk of bids from global rivals and sector consolidation, but a move is far from certain

IAIN DEY
idey@scotlandonsunday.com


OVER the past six weeks or so, Scottish & Newcastle has seen its shares spark into life, a rise of about 15% since the start of October. It is enough to have increased the value of chairman Sir Brian Stewart’s stake by about 130,000 and whetted the appetite of the investment bankers, dealers and lawyers who believe it points to one thing - a bid is coming.

Ask the analysts who pore over every move in the global brewing industry and they struggle to see which of the superpowers of beer are really likely to want to pounce on the Edinburgh-based company - despite its numerous attractions. Yet, in an industry that is on the cusp of the next big phase of consolidation, it is difficult to see where Scottish & Newcastle fits into the grander scheme of things in its current form.

Three years ago, Heineken’s outgoing executive chairman Karel Vuursteen brought an end to his lengthy rein at the Dutch brewing empire by prophesying that a new wave of mega-mergers was about to begin. It would be a "dance of the elephants" which would leave just a handful of brewers left, he said. And Vuursteen did not give the impression that he wanted the family-controlled business to get involved in this process.

The first elephantine dance steps have already been made. In March, Belgium’s Interbrew, owner of Stella Artois and Tennent’s Lager to name but a few beers, struck a 6bn all-share merger with Ambev, South America’s largest brewer with brands including Brahma and Skol. In terms of volume, it is now the world’s biggest brewer, ahead of Anheuser Busch, brewer of Budweiser.

Separately, a tie-up between Canada’s Molson and Coors of the US that was first announced in July looks set to go ahead - despite the best efforts of a group of dissident Molson cousins who don’t think the deal represents good value.

All eyes are focused on the next big deal, which is why the speculation surrounding S&N’s future never subsides for long.

"I have one fairly big problem with this whole S&N bid theory," said one brewing analyst last week. "And that’s just finding someone who actually wants to buy it.

"There’s great logic for any of the middle-sized brewers - the S&Ns and the Heinekens - to sell out to one of the bigger players as consolidation gets going.

"But there are very few parties who would be big enough to do it and even fewer who would want to - certainly at 425p a share, where S&N is at the moment. And most of those who may want to do a deal would struggle to get regulatory approval.

"Only really SABMiller or Anheuser Busch would be able to do it, the rest would face problems in the UK or French market, or, in the case of Carlsberg, just aren’t big enough."

SABMiller has been repeatedly linked with a move for S&N. At the start of the year the gossip reached fever pitch but a bid never appeared. Two weeks ago the speculation flared again when SABMiller chief executive Graham Mackay said he could raise 1.1bn to fund an acquisition if he so desired. But the tongues had barely begun wagging when Mackay qualified his comments by adding that the beer market of western Europe was "not particularly attractive" from an acquisition point of view.

Over the past decade Scottish & Newcastle has transformed itself from a regional brewer into a global player. It is the biggest brewer in the UK, France, Russia, Finland and all three baltic states. It holds number two spot in Portugal, Kazakhstan, Ukraine, Belgium and Greece. It also has a smattering of interests in places such as Greece and India. In global terms, it ranks about sixth or seventh, depending on how you cut the numbers.

But its strengths lie predominantly in the declining markets of western Europe, which the global beer groups are now trying to avoid.

While a hardcore of analysts and investors like to throw up the name of Anheuser Busch now and again, an equally steadfast camp insist this suggestion is nonsense.

Anheuser has stated quite clearly that its ambitions lie in places such as China and Latin America where beer consumption is still actually increasing.

And S&N is no different. It too has been on the acquisition trail, buying cider maker Bulmers, shoring up its interests in Portugal and making moves into India. It was also involved in the bidding for Peroni, which ultimately fell into the hands of SABMiller. And through its takeover of Finnish brewer Hartwall, it has gained its share of the top spot in Russia’s beer market.

Although it is not the focus at the moment, S&N is likely to make further acquisitions if it avoids falling prey to a bigger rival. Apparently S&N chief executive Tony Froggatt has given serious consideration to a handful of other possible deals this year.

S&N has been repeatedly linked with a move for Mahou San Miguel in Spain. Some suggest it could be interested in Cantrell & Cochrane, which would consolidate its cider interests. It could also make a move for the rest of Australia’s Fosters to strengthen its existing ownership of the brand in Europe. But none of these deals would be sufficiently transformational to give a predator indigestion.

Being the biggest brewer in the UK and Europe is all well and good. Now Froggatt has done the dirty work by announcing cost-cutting plans to close the flagship Fountain brewery in Edinburgh and the Tyne brewery in Newcastle, that side of the business looks more attractive to a potential buyer than it did 12 months ago.

But if there is a reason to buy S&N, it is to get access to its Russian business. Baltika, its joint venture with Carlsberg, is already contributing about 20% of S&N’s profits. And it keeps on growing.

There are risks in Russia, as was proven recently by the clampdown on beer advertising, but it is still the jewel in S&N’s crown as things stand.

"It is possible," said another City brewing analyst, "that someone may want to make a bid for S&N to get their hands on Baltika. And it could be a rationale for S&N and Carlsberg to get together.

"But if they did do that, a combined Carlsberg and S&N would have over 40% of the UK market. So big chunks of both companies would have to be sold off and it would get to a point where you’d have to ask whether it was worth the bother. And nothing would happen without the say-so of the Carlsberg trust anyway."

Here is another reason why S&N is often tipped as a takeover candidate. Unlike the other big brewers, there is not a chunky family stake that could block a takeover. Heineken, Anheuser Busch, Carlsberg suffer from this, and Molson is finding to its detriment how big an issue family stakes can be. SABMiller, meanwhile, has issues with its dual listing.

Basically, if you want to buy a big brewer, it is easier to buy S&N than any other as its shares are in the open market. The increased likelihood of a takeover puts S&N’s shares at a premium to Carlsberg, its closest peer. As it doesn’t have this protective influence, some analysts speculate that S&N could be ripped apart once consolidation reaches a certain stage.

A recent report from Dresdner Kleinwort Wasserstein, which proclaimed that "the endgame is nigh" in the consolidation of the global brewing industry, said: "To go from four European brewers (Heineken, InBev, Scottish & Newcastle and Carlsberg) down to three would effectively require one to be taken apart and distributed piecemeal among the remaining three.

"A joint bid by, for example, Heineken and InBev to acquire Scottish & Newcastle is not beyond the realm of possibility but we believe it would be complicated."

Even though any potential deal to take out S&N would inevitably be complicated, there seems little possibility of the speculation surrounding S&N’s future subsiding any time soon. There is still a long way to go in the consolidation of the global brewers, but S&N seems to be caught in the middle.

Perhaps the Edinburgh firm will be left on the shelf leaving Froggatt and his successors free to add to the group’s portfolio of brands through another string of bolt-on acquisitions. But until the rest of the world’s big brewers show their cards, the rumours won’t disappear.

remember next resitance is 444p. And i think we will beat that this time around esp with growth in Russia and Ukraine.

I do hope Yushchenko wins out there by the way.

scot - Many thanks for the S on S piece. Interesting reading.

Times
Directors' dealing: THEMUTUAL.NET (director sells stock for 81,000 stg) -
Rumour of the day: SCOTTISH & NEWCASTLE (rumours of predatory interest from
Anheuser-Busch)

does anyone know when we get dividends this year from this?

share price has been rising well this year

I think that the saying "Theres no smoke without fire" may apply to Scottish and Newcastle's situation. Have held these shares for 3 years or so and added more when T. Hemmings acquired a holding . Sctn has been associated with many preditors but,the most obvious candidate is Carlsberg since both it and Sctn have 50-50 ownership of Baltic Beverages Holdings (BBH) which has a 37% share of the growing beer market in Russia. I think Putin thinks well of this situation since beer is helping to ween the public off of excessive Vodka consumption. Since Carlsberg is changing its cumbersome ownership structure which, has probably held up any merger with Sctn, the interest in Sctn shares have been more pronounced. I think Carlsberg would pay well above current market level to secure Sctn since it would then safeguard its ownership of BBH which has much potential. Sctn also owns 49% of United Breweries which own Indian Brands Kingfisher and Sandpiper. Bulmers were also acquired when they went through a bad patch and have since grown well , not to leave out names like Fosters in Europe and Newcastle Brown Ale. There could well be a bidding war for this one and the volatile market that pevails at present could well bring things to a head. sp 646p

scotinvestor ....late reply but ex div was 28.3.07 (14.44p) should have been paid 2.5. Next ex div will be mid September for Interim.

Easy going thread this, 3 months to get an answer re divis. Scotinvestor log on to the company website, all the info you rquire will be on there.
jj50 pop in and have a coffee sometime....soon :-)

optimistic- I make it 15 months.

Guscavalier.. you're right! LOL

opto ... I'll see you there :-)