Government ordered to review Bass Brewers decision

Related tags Bass brewers Cabinet of the united kingdom

The Government has been ordered to reconsider its decision to block Interbrew's acquisition of Bass Brewers.After a High Court ruling on Friday (May...

The Government has been ordered to reconsider its decision to block Interbrew's acquisition of Bass Brewers.

After a High Court ruling on Friday (May 25), the Belgian brewer is set to hold talks with ministers to discuss an alternative solution to selling the entire UK business.

It followed the results of a judicial review on Wednesday (May 23) that decided that the Competition Commission acted unfairly in recommending the £2.3bn deal should be blocked.

A settlement was reached on Friday after two days of out-of-court talks between the Government and Interbrew.

Trade and Industry Secretary Stephen Byers (pictured)​, who accepted the commission's advice, will now have to reconsider his decision after taking advice from the director of fair trading.

However, it is likely that little progress will be made until after the General Election on June 7, when there may be a new trade secretary in a Cabinet reshuffle.

Interbrew said that all remedies were open for discussion, which may include a break-up of the Bass Brewers business or the disposal of the Whitbread Beer Company business which it bought for £400m last year.

The Belgian brewer has said that it accepted the Competition Commission's concerns about the combined businesses giving it a 32 per cent share of the UK beer market, but it believes it is not necessary to sell the whole of Bass' former UK brewing business.

Interbrew spokesman Corneel Maes said: "Our objective is to meet the secretary of state as soon as practicable to negotiate a suitable outcome."

On Wednesday, Justice Alan Moses said the Competition Commission had not followed the proper procedures during its inquiry into last year's acquisition of Bass Brewers.

He voiced concerns that the watchdog rejected an alternative remedy that Interbrew might sell the smaller Whitbread beer business.

He said: "I am driven to the conclusion that there was such unfairness that [the Competition Commission's] decision cannot stand. It must follow that the Secretary of State's decision must also be set aside."

Justice Moses did not actually criticise the remedy that was proposed or the commission's reasons for coming to its conclusions.

Justice Moses also ordered that 75 per cent of Interbrew's costs in the case should be paid by the government.

Related stories:

Decision to block Bass Brewers ruled "unfair" by High Court (May 23, 2001)

Court ruling on Bass Brewers due (May 21, 2001)

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