24 August 2000 | Cathy Hayward
Belgian brewer Interbrew is planning "substantial" procurement job losses and a reduction in suppliers following the takeover of British-based Bass Brewers and Whitbread Beer Company, according to an Interbrew UK spokesman.
Interbrew would not confirm how many losses were anticipated or what suppliers would be affected. But it acknowledged that when two businesses merged, core departments, like procurement, were the first to be hit.
The job losses seem likely to come from Bass, which is not predicted to join the group until later this year after EU and UK regulatory scrutiny. Interbrew has promised no significant job losses from Whitbread's 4,500 employees, but made no similar guarantee of Bass' 3,800 Burton-on-Trent-based staff.
The takeovers will also result in a squeeze on smaller, less well known real ale brands produced by Interbrew, best known for making Stella Artois. The brewer refused to comment on the fate of brands such as Fuggles Imperial, Welsh Smooth and Castle Eden Ale.
Trade body Independent Family Brewers of Britain, believes foreign owners of UK brewers will concentrate on the big suppliers and high-profile brands, and ditch the others. This is bad news for Whitbread and Bass' smaller suppliers, said Stuart Neame the body's deputy chairman. "It will bring forward the day when you go into a pub and the only thing available on tap will be Stella Artois," he added.
Whitbread's strategic planning director David Richardson agreed that smaller suppliers were under threat. "Brands are getting more important. There are going to be bigger brands and fewer of them," he said.
Smaller suppliers have suffered in recent years as the brewing industry has consolidated. Vaux brewery in Sunderland and Morland's Old Speckled Hen site in Abingdon shut last year with the loss of around 800 jobs.
Interbrew's chief executive Hugo Powell has said there are synergies to be gained from the takeovers. "Our ambition is to be more efficient on the supply side because if we are not, we cannot continue brand building and then we go out of business," he said.
But Bass has hit back claiming it is too early to say whether there will be job losses or supplier cuts. "Interbrew only paid £400m for Whitbread but paid £2.3bn for Bass," said Bass head of communications Philip Malpass.