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Lion To Purchase Little World Beverages

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.DJ.

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http://www.brewsnews.com.au/2012/06/breaki...nds-lion-offer/

Little World Beverages Board Recommends Lion Offer to Acquire 100% of Little World Beverages by Scheme of Arrangement

Monday 18 June 2012: Lion confirmed today that it has reached an agreement with the Board of Little World Beverages to acquire the shares in Little World Beverages it does not already own by way of a Scheme of Arrangement (Scheme). Under the Scheme, Lion proposes to offer Little World Beverages shareholders $5.30 per share in cash (the Offer) subject to the successful implementation of the Scheme.
 

Bribie G

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So the quality of James Squire hasn't been compromised. Hang on, gotta go now - squadrons of pigs are doing formation manoevres in the sky at the moment, can't miss this.
 

bkmad

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So the quality of James Squire hasn't been compromised. Hang on, gotta go now - squadrons of pigs are doing formation manoevres in the sky at the moment, can't miss this.
Indeed. I give it 6 months before their pale ale goes the way of JS golden and ends up tasting suspiciously like tooheys new. I so hope I am wrong though :angry:
 

Aus_Rider_22

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Not good news :(

So I guess we will see Little Creatures and White Rabbit beers slowly be dumbed down?

Also, if Little Word Beverages has a 20% stake in Stone & Wood, does that mean Lion Nathan automatically aquires that 20%?
 

Lord Raja Goomba I

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Not good news :(

So I guess we will see Little Creatures and White Rabbit beers slowly be dumbed down?

Also, if Little Word Beverages has a 20% stake in Stone & Wood, does that mean Lion Nathan automatically aquires that 20%?
Effectively.

It meanst the shares in S&W owned by LWB, will remain owned by LWB, but 100% of the shares in LWB are owned by Lion Nathan Kirin, giving them effective ownership of 20% of S&W.

The question is, will there be an ACC/Anticompetition court case over this. I should look at the ASX announcements, because I'm sure the ACCC would have looked at this, considering LWB are effectively the 2nd largest aussie owned brewer and Lion Nathan Kirin, already own JS.
 

Bribie G

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I would imagine the Chardonnay sipping ACCC board members would consider any concerns over domination of the brewing industry to be quite risible, viewed from their lofty heights where no common people belong.
 

Lord Raja Goomba I

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So looking at the paperwork, this is a scheme of arrangement between the two parties, and subject to the following approvals:

Court Case with ASIC and ASX approving the implementation (pretty much a standard procedure)
FIRB (restriction on foreign ownership) being approved
Tax office approval
Anything else (presumably ACCC will intervene under this, if they do).

I reckon there is an argument for the fact that the largest brewer in the country is Coopers, LNK own JS already, with CUB owning Matilda Bay (formerly of Freo) and the craft brewing industry is a difficult industry to start up (capital wise) remain competitive in, given the excise and the fledgling state of the industry.

Taking over LWB, has the potential for causing the financial ruin of all craft brewers not owned by LNK and CUB, by virtue of scale of operation afforded by LNK.
 

Nick JD

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Hopefully Lion Nathan manage to get rid of the "rusty nails" taste in bottled LCPA. :D
 

winkle

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Say goodbye to the single batch brews :(
 

bconnery

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Say goodbye to the single batch brews :(
Not necessarily.
It's been reported widely that beer sales are dropping, which makes the big boys very concerned and looking for areas of growth.
Craft beer is a market segment that is growing.
The new owners may want to continue with the model that made the acquisition an attractive prospect in the first place.

But then again as a economist I make a good homebrewer so the potential for me to be very wrong is reasonably high...
 

insane_rosenberg

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Lion has a strong record in nurturing smaller premium brands without compromising entrepreneurialism or quality. Such brands include James Squire...
:lol: :lol: :lol: :angry:
 

tiprya

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I reckon there is an argument for the fact that the largest brewer in the country is Coopers, LNK own JS already, with CUB owning Matilda Bay (formerly of Freo) and the craft brewing industry is a difficult industry to start up (capital wise) remain competitive in, given the excise and the fledgling state of the industry.
LWB holds such small market share that this take-over is never going to substantially decrease competition in the industry.

The ACCC won't be able to do anything.
 

Snowdog

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I'll probably completely quit buying bottles for home consumption and buy more 4 Pines Pale instead.

I may buy more at pubs as I would assume that they will appear in more LNK contracted pubs?
 

Lord Raja Goomba I

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LWB holds such small market share that this take-over is never going to substantially decrease competition in the industry.

The ACCC won't be able to do anything.
It'll depend on whether there's a political impetus, because we have so few Aussie owned breweries now, combined with whether they view craft/micro/non-mainstream beer as a separate industry segment than megaswill.

Given the recent alteration to the excise, there may be that political impetus, though I really don't know that for a fact.

ACCC only does what is politically important. It's why petrol stays so high. It's an effective interest rate hike across all persons (regardless of whether they own or rent), and an effective carbon tax to boot. It keeps inflation lower, because if we all paid $50 less per week (as we probably should), we'd be spending it on other stuff and driving the price of that up. But a stable (if not high) fuel price will have no effect on official inflation figures (as we've been paying $1.50 per litre for well over a year, so no 'increase' has occurred), so it's left there to make sure that other CPI 'ingredients' stay stable as well.

That's my theory, right or wrong.
 

DJR

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Indeed. I give it 6 months before their pale ale goes the way of JS golden and ends up tasting suspiciously like tooheys new. I so hope I am wrong though :angry:
I don't know if you guys are aware but JS has *always* been owned by Lion/Tooheys, it was the old Hahn brewery they bought and when Chuck started JS there it became known as the Malt Shovel Brewery but still owned by Lion/Tooheys.

Current changes down there are more about marketing and scale (the beers move around between MSB, Swan and Lidcombe AFAIK depending on demand etc) than any ownership change

The Mad brewers range is all MSB camperdown i believe
 

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