Call for OFT to stop Wolves takeover

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The Campaign for Real Ale has called for the Office of Fair Trading (OFT) to stop Pubmaster's proposed takeover of Wolverhampton & Dudley...

The Campaign for Real Ale has called for the Office of Fair Trading (OFT) to stop Pubmaster's proposed takeover of Wolverhampton & Dudley Breweries (W&DB).

It claims that a deal could lead to deterioration in quality of the brewer's two major brands, Marston's Pedigree and Banks's.

The consumer group has also launched its own defence document claiming that that the offer would be bad for shareholder value.

Pubmaster raised its offer on Monday (July 30) from 480p a share to 513p, which increased the value from £453m to £485m.

It was again rejected by W&DB's board as "penny-pinching" and "significantly" undervaluing the business. However, investors with stakes totalling 16.8 per cent of shares have already accepted the offer with nearly two weeks before the final deadline.

Visitors to CAMRA's Great British Beer Festival, which opened on Tuesday (July 31), will be urged to sign petitions and pledge cards to support the campaign.

CAMRA's head of campaigns Mike Benner said the group had written to the OFT calling for an urgent referral of the bid to the Competition Commission.

"The revised bid continues to undervalue the business and shows little respect for the interests of consumers and stakeholders in Britain's biggest regional brewer," he said.

"We fully support the current board in its efforts to fight off the bid and remain independent and we firmly believe that both consumers and shareholders will enjoy long-term benefits by sticking with W&DB.

"Pubmaster has announced plans to sell Marston's and Banks's breweries if its bid is successful. It is very likely in the current climate that these will fall victim to the axe of a large brewer who is keen to eliminate competition from the market.

"This will leave valued beers like Pedigree and Banks's Original to be brewed outside their Burton and Wolverhampton heartlands. This will kill the integrity and flavour of the beers.

"Consumer support for our campaign proves that it's a plan which is doomed to fail."

CAMRA has already gathered over 5,000 signatures and pledge cards in support of its campaign. Supporters have pledged not to drink Banks's and Marston's beers if they are brewed under contract at other plants.

Related stories:

Pubmaster raises offer for Wolves (July 30, 2001)

Pubmaster renews attack on Wolves (July 24, 2001)

Wolves steps up defence against Pubmaster (July 23, 2001)

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