Carlsberg hits back at latest S&N claims

Carlsberg has hit back strongly at the latest claims by Scottish & Newcastle (S&N) that it has breached the terms of its Baltic Beverage Holdings (BBH) joint venture agreement.

S&N said earlier today that Carlsberg had "misused confidential information, has breached its duty of loyalty and other express provisions in the [BBH shareholder] agreement, has circumvented the 'shotgun' and its actions will damage the joint venture".

However Carlsberg said there was no evidence of its subsidiary and signatory to the joint venture agreement, Pripps-Ringes, having breached its terms.

The Danish brewer called S&N's claims to this effect "frivolous and absolutely without merit" given that S&N's subsidiary, Hartwell, "has not demonstrated the existence of any [breaches]".

The shotgun accusation was also dismissed by Carlsberg: "S&N's comments regarding circumvention of the shotgun mechanism in this context are irrelevant and misleading.

"The shotgun gives Pripps-Ringes and Hartwall the right to exit the BBH agreement if either party so wishes by offering its shares to the other party. It is up to Pripps-Ringes or Hartwall whether it exercises this right. Neither has done this and accordingly, the shotgun clause has no current application.

In its statement Carlsberg went on that it "noted S&N's allegation that Carlsberg has damaged the joint venture because of the public differences between Carlsberg and S&N over the future of BBH.

"Carlsberg continues to be fully committed to the future of BBH and would suggest that S&N exercises the same high level of commitment pending the outcome of the arbitration proceedings."

Carlsberg and PRAB reserve all their rights in relation to the serious and misguided allegations S&N continues to make."

Jorgen Buhl Rasmussen, president and chief executive of Carlsberg said: "We've seen nothing new of substance today.

"S&N continues to progress with a case that has absolutely no merit instead of focusing on the certainty of the cash value of the consortium's proposal, which is the only deliverable means of maximising value for S&N's shareholders today," he said.

The consortium of Carlsberg and Heineken has two weeks to put together a formal bid for S&N or walk away.