Pressure builds on S&N to accept bid

LONDON Shareholder pressure mounted on Scottish & Newcastle to accept a slight improvement in the offer of 750p ($15) a share from rival brewers Carlsberg and Heineken.

Last month, following Carlsberg and Heineken’s indicative ?7.3 billion ($14.4 billion) offer in November, the UK’s Takeover Panel imposed a January 21 deadline on the company to increase their offer for S&N or walk. Initially, most shareholders felt the 750p offer undervalued the company and were hoping for more than 800p. Recent evidence of falling beer consumption in Europe and the United Kingdom, as well as uncertainty about prospect for financial markets this year, has prompted some investors to lower their expectations.

Also, Legal & General and Scottish Widows Investment Partnership, two of the UK brewer’s largest shareholders, said that before considering any offer they needed more information on the prospects for Baltic Beverages Holding, Carlsberg’s Russian 50-50 venture and S&N’s highest-margin and fastest-growing regional business with sales and earnings growing 33 percent last year, lifting profits by a third to ?393 million ($776.2 million). Carlsberg has blocked S&N from issuing more information about BBH, of which Mark Burgess, head of active equities at L&G Investment Management and S&N’s third-largest shareholder, has said that without more transparency on BBH, shareholders could not assess a fair price for S&N.