Government to decide on OFT report on Interbrew

The Government is to announce its decision on Interbrew's acquisition of Bass Brewers "as soon as practicable".

The Office of Fair Trading (OFT) has confirmed that it submitted its recommendations on the deal to the Department of Trade and Industry (DTI) on Thursday (August 9).

It has given Trade and Industry Secretary Patricia Hewitt its views on which of four possible remedies would be best for the business.

Last month, the OFT announced four ways in which Interbrew could overcome UK competition concerns caused by its acquisitions of Bass Brewers and Whitbread Beer Company (WBC).

They were:

• the Bass Brewers remedy - the sale of Bass Brewers
• the Carling remedy - the sale of the Carling brand and selected parts of Bass Brewers
• the International Brewer remedy - the sale of the majority of Bass Brewers, excluding Carling, Bass Ale and some minor brands
• the WBC remedy - the sale of WBC.

A DTI spokeswoman said it would consider the OFT's recommendations carefully, and announce its decision as soon as practicable.

However, it is expected that the Carling remedy is the most likely, which would allow Interbrew to keep Bass Brewers' business in Scotland and Northern Ireland and the Bass ale brand while selling Carling Brewers.

Buyers thought to be interested in the Carling business, thought to be worth about £1.2bn, would include Heineken and South African Breweries.

Interbrew bought Bass and Whitbread's brewing arms last year but it was ordered to sell Bass' UK brewing business by the previous trade and industry secretary, Stephen Byers.

However, the Government was told to re-assess its decision after it was overturned in the High Court.

The OFT is also likely to look into Interbrew's proposed takeover of German brewer Brauerei Beck, which owns the UK's third biggest-selling premium packaged lager (PPL).

The Belgian brewer already owns the number one PPL, Stella Artois, although Scottish & Newcastle has the UK rights to Beck's until 2012.

Related stories:

Interbrew deal for Beck's raises competition questions (August 6, 2001)

Government to decide on future of Bass Brewers (July 5, 2001)