Friday, 11 April 2008

Caledonian Brewery

S&N buys Deuchars and brewery
will pass to new owner Heineken

Caledonian Brewery has been bought -- lock, stock and barrel -- by Scottish & Newcastle, which means ownership of the Edinburgh brewery will pass eventually to Heineken. In 2004, S&N, which had closed its breweries in both Edinburgh and Newcastle, bought the Caledonian site in Slateford Road and also took a 30% stake in the company. The brewery continued to be run by the Caledonian management led by managing director Steve Crawley while S&N used its enormous muscle to promote the Caley brands in the free trade. Caledonian Deuchars IPA, far and away the biggest brand, is now available nationally as far away as Cornwall.
Steve Crawley will remain at the helm of Caledonian and will oversee a dramatic change of ownership when Heineken moves in. Earlier this year, Carlsberg and Heineken successfully bid for S&N, with Carlsberg taking over S&N's interests in Russia and the Baltic States, and Heineken becoming responsible for S&N's activities in Britain.
The Harviestoun Brewery, a subisidiary of Caledonian, will become independent: Heineken will have no involvement in the company but Steve Crawley will become a non-executive director.
It seems unlikely that Heineken will tinker with a brand as successful as Deuchars IPA, a past winner of CAMRA's Champion Beer of Britain award. The Dutch company might be tempted to cash in on the property potential of the Slateford Road site, on the road to Edinburgh Airport, but wise councils will point out that consumers tend to react against beers when they are moved from their original home : Deuchars brewed in Yorkshire or Manchester would take the gloss of a successful Scottish brand.

Thursday, 3 April 2008

Refresh UK

Marstons gobbles up Brakspear and Wychwood

In a deal worth between 10m GBP and 11m GBP, national brewing giant Marston's has bought the leading Oxfordshire-based regional Refresh UK, a drinks company that owns both the Brakspear and Wychwood breweries. Since the turn of the century, Marston's of Burton-on-Trent -- which includes Banks's of Wolverhampton -- has bought Jennings of Cumbria, Ringwood of Hampshire and now Refresh.
Rupert Thompson of Refresh, who will leave the company in six months' time, says the deal will be good for his brands. "In today's highly competitive market, we lack muscle, especially in the pub trade, where we own no outlets. There's a logic in working closely with Marston's because of their strength in the on-trade and our strength in supermarkets."
Wychwood's Hobgoblin strong dark ale is now a leading packaged brand. The merger will mean Marston's will be the biggest seller of premium bottled beers. It will also acquire the top-selling organic beers in Britain, which include Prince Charles's Duchy Originals beers.
Refresh UK was formed in 2000 and last year posted a turnover of 24.9m GBP and pre-tax profits of 1.1m GBP. It owns the Wychwood brewery in Witney and added the former Brakspear plant from Henley-on-Thames when that brewery closed. The plant includes Brakspear's famous "double drop" fermentation process that gives Brakspear Bitter and Special their characteristic aroma and flavour. Refresh UK brews a total of 50,000 barrels a year.
Rupert Thompson admits that while the Wychwood brands have done well, the Brakspear beers have struggled, probably a result of consumer anger with the former owners' decision to stop brewing in Henley and become a pub company. (Considerable confusion is caused by the existence of a Brakspear pub company and an unrelated Brakspear brewery.)
While it is true that Marston's has a good track record of not closing the breweries it has bought, there must be considerable anxiety over the loss of yet another successful regional producer. There may well come a time when Marston's will review its overall production and decide that some of its brands, currently brewed in Cumbria, Hampshire and Oxfordshire, could be transferred to Burton or Wolverhampton.
Rupert Thompson undoubtedly saved the Brakspear brands and unique brewing kit and for that all beer lovers should salute him. But the loss of yet another independent regional brewer is a cause for concern.