Marston's and Carlsberg UK announce £780m merger

  • Marston's and Carlsberg UK announce £780m merger

Marston's and Carlsberg UK announce £780m merger

Danish brewer Carlsberg and British pubs and cask ale firm Marston's have announced a joint venture, prompting concern among small brewers who fear being squeezed out of the market.

The deal values the UK's largest brewing business, with six breweries and eleven distribution centres, at up to £580m, nearly three times its current market cap and around 13 times adjusted 2019 earnings before interest, tax, depreciation and amortisation (EBITDA).

Cees 't Hart, the chief executive of Carlsberg, said the new venture is "a step forward" for the brewer, which recently spent £20 million on a marketing campaign to advertise its new flagship beer.

Shares in Marston's surged by 36%, recovering some of the value lost since the Covid-19 lockdown shut pubs across the country, as investors applauded the tie-up.

The chief executive of Marston's, Ralph Findlay, said: "This new partnership acknowledges Marston's strategy, position and consistent outperformance against the United Kingdom beer market, realising value for shareholders today, whilst retaining an interest in the future upside of the combined entity".

"This new partnership acknowledges Marston's strategy, position and consistent outperformance against the United Kingdom beer market, realising value for shareholders today, whilst retaining an interest in the future upside of the combined entity". After a successful relaunch of Carlsberg Danish Pilsner in the United Kingdom previous year, we are now building a new beer company by combining two organisations with shared values and strong history and heritage in brewing.

Tomasz Blawat, MD of Carlsberg UK, said: "We are excited to move into the next phase of our growth strategy".

Carlsberg Marston's Brewing Company will also have access to Marston's pub estate for its beer portfolio which is "enshrined through a strategic, long-term supply and distribution agreement", according to a statement from Carlsberg.

"We believe the new business will deliver even more value for employees, customers and consumers, thereby creating greater future growth potential".

Carlsberg UK will put it's Northampton brewery, London Fields brewery, and national distribution centre into the joint venture.

"The joint venture's brand portfolio will allow us to offer a significantly stronger beer portfolio to our United Kingdom customers", he said.