Both companies will inject their brewing and distribution assets into the joint venture. In addition, at completion, Carlsberg will pay up to £273m to Marston’s plc, £34m of which will be a deferred contingent payment.
Consequently, Carlsberg will become the controlling shareholder, owning 60% of the joint venture, with Marston’s owning 40%. The transaction is anticipated to complete in the second half of this calendar year, subject to shareholder approval at Marston’s, and competition clearance.
The Carlsberg Marston’s Brewing Company will have a strong portfolio of international, national and regional beer brands. Carlsberg’s brands include Carlsberg Danish Pilsner, Carlsberg Expørt, Poretti, Tetley’s, Somersby cider, and the London Fields Brewery craft portfolio, as well as the UK licence for San Miguel, Mahou and the Brooklyn Brewery craft beer portfolio. The Marston’s portfolio includes Hobgoblin, Wainwright, Marston’s Pedigree, and 61 Deep, and the company also owns the Banks’s, Jennings, Ringwood and Eagle beer brands. It also has the UK licence for global brands Estrella Damm, Shipyard, Erdinger, Warsteiner and Kirin.
Under the terms of the proposal, the joint venture will have access to the Marston’s pub estate for its beer portfolio through a long-term strategic partnership. Marston’s operates around 1,400 pubs. The joint venture will benefit from Marston’s Beer Company’s wide distribution network. Marston’s Beer Company distributes to around 11,000 customers directly, including the independent free trade, other pub companies, the off-trade and export.
Carlsberg chief executive, Cees ’t Hart, said: “The creation of the joint venture is an important step forward for our UK business. The joint venture’s brand portfolio will allow us to offer a significantly stronger beer portfolio to our UK customers, and at the same time extend distribution into the Marston’s pub estate.
“In addition, the combined business will bring our customers wider choice, greater capacity, product innovation, and marketing and distribution efficiency benefits.”
Industry reaction: SIBA and CAMRA
James Calder, chief executive of the Society of Independent Brewers (SIBA), said: “This merger is the latest in a series of consolidating measures within the UK beer market. It has the potential to take the Marston’s brand global and brings Carlsberg back into the distribution and porterage business only after a few short years of leaving it.
“This merger yet again has the potential to impact negatively on small independent brewers by further reducing the access to market they receive.”
Campaign for Real Ale (CAMRA) chief executive, Tom Stainer, added: “This announcement about a proposed new Carlsberg Marston’s Brewing Company is a red flag to beer drinkers and pub-goers across the UK and gives us cause for concern about the future of British beers, brands and breweries.
“If this joint venture goes ahead, we would see further consolidation of the brewing industry into just a few large, international players — to the detriment of our national brewing heritage, consumer choice, the diversity of beer in pubs across the country, and the access to market for the small, independent brewing industry.
“CAMRA wants to see Carlsberg and Marston’s protect jobs and protect pubs, as well as to resist any brewery closures or moves which would see existing beers losing their identity, or regional character, as part of a merger.”