German merger falls through

Brau und Brunnen first half losses cloud deal

Sept 12, 2000 - German brewers Brau und Brunnen and BrauHolding have called off their planned merger to form Germany's largest drinks group because they couldn't agree on its valuation.


The provisional agreement to purchase Dortmund-based Brau und Brunnen, reached in June, would have created Germany's largest brewer. BuB's major shareholder, HypoVereinsbank AG, which holds more than 50%, had agreed the company should be brought under the umbrella of the Schoerghuber group, which owns 98% of Bayrische BrauHolding, and was prepared to reduce its stake to some 20% of the new group.

Closer inspection of BuB's accounts, however, changed the Bavarian holding company's view, according to German reports. A takeover would have required a far more wide-ranging and costly restructuring than originally planned. BuB lost DM18 million in the first half of 2000.

A spokesman for Bayrische BrauHolding told Reuters the group was still interested in BuB, but the deal could not go forward in the form originally planned.

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