Carlsberg-Marston’s merger aims for £24m synergies

26 May 2020

Carlsberg UK and Marston’s have proposed to merge in a joint venture (JV) worth £780m to create a “brewer and distribution company with increased scale and resources”.

The partnership would achieve “significant synergies and efficiency benefits” of around £24m a year after its third year, the firms said. 

Synergies would stem from “overhead costs, brewery and logistics efficiencies and procurement savings”.

“The one-off cost of achieving these synergies is expected to amount to approximately £32m,” the firms said.

The merger aims to increase distribution scale, brewing capacity and efficiency across the brewery and logistics network.

“Carlsberg UK has invested £30m in production over the last three years, whilst Marston’s invested in a new canning line in 2018 opening up more sales opportunities in addition to bottling. 

“The joint venture will benefit from both Joint Venture partners’ strong brewing heritage and logistics capability, brewing and packaging facilities, logistics capabilities and marketing expertise,” the firms said. 

Carlsberg will own 60% of the JV, named the Carlsberg Marston’s Brewing Company (CMBC), while Marston’s, which produces cask ale brands such as Hobgoblin and Pedigree, would hold the remaining 40%.

Ralph Findlay, chief executive of Marston’s, said: “Marston’s strong heritage, extensive distribution platform and established reputation for brewing and logistics excellence, together with Carlsberg UK’s values, long history in beer, brand portfolio and scale, combine the best attributes of both to create a compelling beer business with an outstanding portfolio of global and local beer brands, proven brewing expertise, strong distribution network and wholesale opportunity.”

Tomasz Blawat, managing director of Carlsberg UK, said: “Our intent for the Carlsberg Marston’s Brewing Company is for it to become a platform for growth for all of our customers and suppliers, offering a bigger beer portfolio of complementary international, national and regional brands. We believe the new business will deliver even more value for employees, customers and consumers, thereby creating greater future growth potential.”

The deal is subject to regulatory and shareholder approval.

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