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Interbrew-Bass deal killed
Belgian brewery must sell Bass interests
Jan 3, 2001 - British authorities Wednesday rejected Interbrew's £2.3 billion takeover of Bass brewing and ordered the Belgian brewer to sell the assets.
Trade Secretary Stephen Byers said the Competition Commission advise that only voiding the whole takeover would prevent the creation of an unhealthy duopoly in the market between Interbrew and Scottish & Newcastle. The deal would have given Interbrew a 32% share of the U.K. market and made the Belgian brewer the second largest in the world. Speculation before the announcement was that Interbrew would be forced to sell one of its brands -- such as Carling -- before the takeover would be approved. However, the commission concluded that the merger would "reduce competition in the market, lead to higher prices for end consumers and reduce consumer choice," Byers said. "The Competition Commission found that the merger would strengthen Interbrew's market position, with four of the ten top selling beer brands, including two of the top three, Carling and Stella Artois." Interbrew now faces the prospect of a forced sale, probably to one of its global rivals such as Heineken, Carlsberg or South African Breweries. Heineken said it was studying the decision and keeping its options open. A Carlsberg spokesperson said the brewery would not do anything without being sure it was an "approved buyer" by the U.K. regulator. A deal between Carlsberg and Bass was blocked by the U.K. Department of Trade and Industry in June 1997 on competition grounds.
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