Carlsberg hits back at Scottish & Newcastle over BBH agreement claims

The war of words between Carlsberg and Scottish & Newcastle (S&N) was stepped up yet again today, with the Danish brewer officially rebuffing S&N's claims that the pair's agreement over Baltic Beverage Holdings (BBH) had been breached.

Relations between the two brewing giants - and business partners in BBH - have sunk to an all-time low after Carlsberg and Heineken launched a £6.8bn bid for the UK brewer last week.

In a statement released this afternoon Carlsberg said it "notes the announcement earlier today by S&N of its initiation of arbitration proceedings with respect to alleged breaches of the BBH shareholders' Agreement.

"Carlsberg reconfirms its position having received unequivocal legal advice from the leading law firms Vinge in Sweden and Norton Rose in London that there is no foundation to S&N's misguided claims.

"S&N shareholders should also be aware that such arbitration proceedings in Sweden typically take in excess of 12 months to reach a final conclusion."

The brewer went on: "Carlsberg also notes that the claim has been brought against Pripps Ringnes Ab, a member of the Carlsberg group and not against Carlsberg A/S."

It said it had already announced on October 23 2007 "that it believed the various claims made by S&N alleging certain breaches of the Agreement have no merit".

Carlsberg said both it and its legal advisers had confirmed this in writing to S&N on October 26 2007.

Carlsberg also made a veiled threat that it might seek damages from the situation. The group "reserves its position with regards to a claim for material damages", it said.

Commenting on S&N's announcement, Jorgen Buhl Rasmussen, Carlsberg's chief executive, said: "S&N's legal claims are spurious, without merit and a distraction to advancing discussions on the 720p proposal the consortium made to S&N on October 25."

Carlsberg said it urged the board of S&N "to engage with the Consortium with a view to progressing its proposal which is aimed at delivering certain cash value to S&N shareholders".