Bass starts talks to buy Czech brewer
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Your support makes all the difference.Bass said yesterday it was forcing the pace of its ambitions in the Czech Republic by opening discussions with one of the country's largest banks which has staunchly opposed the brewer's expansion plans.
Having increased its stake in the Radegast brewery last week from 20 to 33 per cent, Bass said it was confident of striking a deal before the end of the year with one of the brewer's other main shareholders. To do so it would have to strike a deal with IPB, the bank which owns 34 per cent of Radegast and has so far opposed the acquisition by Bass of a stake from another Czech investor.
Bass country manager Mervyn Childs said yesterday that because there were few shares left available on the open market, Bass was now focusing its attention on IPB. "I hope that our discussions will lead to something, certainly within the course of this year," Mr Childs said.
Bass already owns 51 per cent of Prazske Pivovary, which controls about 14 per cent of the local market compared with the 16 per cent share claimed by Radegast. It has ambitions to create a group with around 25 to 30 per cent of the Czech domestic beer market and is understood to favour an eventual merger between the two brewers.
Bass moved into the Czech beer market in 1993 when it took a 34 per cent stake in Prague Breweries. The British group now also owns majority shares in two small regional Czech breweries, Vratislavice and Ostravar.
Apart from moving into the Czech market, which boasts the world's highest per capita beer consumption, Bass has been keen to push Czech beers in western Europe and Russia.
Bass and IPB have become the two largest shareholders in the Czech brewing industry, which is barely profitable but is considered to have big export potential. Prague Breweries, whose premium brand is Staropramen, has seen exports surge to 290,000 hectolitres in 1996 from 109,000 hectolitres in 1994.
Whoever wins control of Radegast, the most profitable and efficient of the big brewing groups, will have the dominant role in the industry and the largest portfolio of brands.
Bass is moving to expand its overseas operations to diversify away from the mature UK beer market, where it is currently embroiled in a Monopolies and Mergers Commission investigation into its planned takeover of Carlsberg Tetley.
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