Britain's biggest brewer valued at £7.8 billion

Carlsberg and Heineken yesterday agreed a joint cash bid of 800 pence a share for Scottish and Newcastle (S&N) that will split up the brewer of Foster's and Kronenbourg.

Denmark's Carlsberg and Amsterdam-based Heineken said they had agreed a deal recommended by S&N which valued Britain's biggest brewer and the world's sixth-largest beermaker at £7.8 billion.

The bidders say the approval of the European Commission and other competition authorities will be required and it is expected the deal will be completed in the second quarter.

S&N and Carlsberg have agreed to release projected information for their 50-50 Russia-based joint venture Baltic Beverages Holding (BBH) for this year through 2010, which had been a sticking point in the three-month long takeover saga.

Under the proposed breakup plan, Carlsberg will acquire S&N's 50 per cent stake in BBH to give the Danish brewer full control of this Baltika brewer in the former Soviet Union and also S&N's interests in France, Greece, China and Vietnam. Heineken will take over S&N's British business, which includes Strongbow cider and John Smith's beer, along with its operations in other European markets such as Belgium, Portugal, Ireland, plus its US and Indian businesses.

"In a single step we have created the world's fastest-growing global brewer. We now have full control of our destiny in Russia and other BBH territories," said Carlsberg chief executive officer Jorgen Buhl Rasmussen in a statement.