Elders To Buy English Brewer For $2.07 Billion; Drops Allied-Lyons Bid
Sep. 18, 1986
LONDON (AP) _ Elders IXL Ltd., an Australian brewing and trading concern, said Thursday it agreed to buy the Courage brewing unit of Hanson Trust PLC of Britain for the equivalent of $2.07 billion.
Separately, Elders said it formally dropped its controversial bid of nearly $3 billion to acquire Allied-Lyons PLC, a major British food and beverage company. The bid had lanquished for several months because of an antitrust review by British authorities.
Hanson Trust, a British conglomerate whose holdings include New York-based SCM Corp., acquired the Courage brewing company when it bought Imperial Group PLC of Britain for $4.2 billion in April.
Courage is one of the best-known names in British beer. Its purchase would give Elders, which makes the popular Fosters lager of Australia, three breweries that make Courage and John Smith beers, 5,000 pubs throughout Britain and 386 liquor stores.
The proposed acquisition ''fulfills our long-held ambition to become a major force in U.K. brewing,'' Elders Chairman John Elliott said at a news conference.
Elliott also confirmed that Elders' bid for Allied-Lyons was off for now, but said Elders remained interested in the company.
Elders' offer for Allied-Lyons, launched last October, was delayed while it was reviewed by Britain's antitrust agency, the Monopolies and Mergers Commission.
Although the commission earlier this month said Elders could pursue the offer, the situations of both Elders and Allied-Lyons had changed significantly in the meantime.
Elders purchased a 20 percent stake in Broken Hill Proprietary Co. of Australia, which in turn bought a 20 percent interest in Elders.
Allied-Lyons, meanwhile, recently agreed to buy control of the liquor business of Hiram Walker Resources Inc. of Canada, which makes Canadian Club whisky among other brands.
As a result, industry analysts had suggested that Allied-Lyons might now be worth more than Elders was willing to pay, and that Elders might turn its acquisition sights elsewhere.
When Elders launched the Allied-Lyons offer, Elliott was dismissed by some British business analysts as an upstart trying to bite off more than he could chew.
But the decision by the Monopolies and Mergers Commission said Elders was ''not a weak or insignificant company'' but one that since 1981 had expanded sharply ''and maintained its stability and prosperity.''
By acquiring Courage, Elliott would join several other Australian natives who have purchased major interests in British industry.
They include Rupert Murdoch, now a U.S. citizen, whose four London newspapers include The Times; Robert Holmes a Court, who recently bought a stake in the Standard Chartered banking group; and Alan Bond, winner of yachting's America's Cup and owner of Hampton Gold Mines.
Close behind the Australians have come New Zealanders, notably Ron Brierley, who has launched a $390 million bid for Ocean Transport and Trading, a British shipping line.