Private investor: Raise a glass to the economic slow down
Saturday 03 November 2007
Globalisation is a curious thing. A couple of weeks ago I found myself in a bar in Kazakhstan (like you do) downing a bottle of perfectly acceptable Kazakh beer. By the way, I have to point out that I only met one person in the country who looked anything like Borat, though that person was the prime minister, so make of that what you will. Also by the way, Kazakhstan was unfairly traduced by Sacha Baron Cohen in his hilarious film, but I would hope you'd gathered that by now.
Anyway, back to the beer. I hadn't given its provenance much thought until I came back to Blighty and started to read the coverage of the takeover bid for Scottish & Newcastle, which is shaping up to be one of those great long running City sagas. Naturally I was interested in S&N because I'd bought a few shares in the company a few years ago, mainly because of its expansion in Russia and the ex-USSR CIS states, such as – you've guessed it – Kazakhstan.
Apparently, Baltika and its associated brews are doing great business out east – just as I thought they would. The Russians are moving from their traditional taste for vodka towards lagers. Funny how they're moving in that direction just as so many young Britons are finding an unquenchable thirst for vodka of every variety. Globalisation and melding of cultures again, I suppose.
As usual, my prescience has only seen me right for a few years. I bought the shares in 2002 and again in 2006 at about 500p and 600p respectively, and they haven't proved spectacular performers, even now the price is approaching the 800p mark, a comfortable margin above the Carlsberg/Heineken bid of 720p a share. Nice to see the markets agree with me that my asset is worth more than that.
The complicating factor, and a bit of a salvation, is that the Baltika breweries are in a joint venture between Scottish & Newcastle and Carlsberg, and there is some sort of immensely complicated clause in that contract that pretty much snookers Carlsberg's bid. Hence the premium the shares are trading at.
Like my colleague Derek Pain, who has also been an enthusiast for the shares, I can't help feeling that, whatever becomes of the Carlsberg/Heineken move, Scottish & Newcastle is probably not going to remain an independent entity for long. I saw some coverage over the weekend that the Scottish National Party thinks that, if it were leading an independent Scotland, precious national assets such as Scottish & Newcastle Breweries would be protected by a more activist Scottish Department of Trade and Industry (or whatever it would be called).
Nice idea, but sadly misguided in our globalised world. All that would do is entrench a relatively small, uncompetitive firm. I say that as a loyal shareholder who'd rather see it keep ploughing its furrow and reaping the rewards of its wisdom in getting into the world's fastest growing beer market so early and so decisively. Natural justice says they (me) should take the dividends from that; economic sense tells me to let the brewing industry sort its own problems out.
Apart from the Russian venture, S&N has some excellent brands such as Fosters, Kronenbourg and, of course, the great Newcastle Brown Ale, now sadly no longer brewed in Newcastle itself ( I didn't notice S&N getting too emotional about shutting that brewery – doubly strange as they'd lobbied so hard earlier for it to be one of the EU's geographically protected brands, like Parma ham or Champagne.
I'm also quite attracted to drinks companies now because of the double effects of the smoking ban and the slow down in the economy. It goes like this. When the Irish betrayed the great traditions of the smoky Irish boozer and went for a smoking ban plenty of those old bars shut down as people started drinking at home rather than the pub; bad news for the pub firms but not so depressing for the brewers.
Second, the slowdown. Again the usual first casualty of a more cautious public is the leisure sector. Trips to the cinema, pub or restaurant are easily postponed while you're feeling the pinch. However, on the weekly trip to the supermarket you might opt instead to put a nice cheap six pack or bottle of Aussie red in the basket to compensate for those nights out you can't quite afford just now. Again, great news for the drinks companies that I'm investing in: S&N, Diageo, Pernod Ricard.
- 1 Porn block in India: hundreds of sexual websites banned, internet outraged
- 2 Malaysia issues arrest warrant for Gordon Brown’s sister-in-law after she publishes stories on leader Najib Razak's financial affairs
- 3 Gamers confess the worst things they've done in The Sims
- 4 Sex with robots will be ‘the norm’ in 50 years
- 5 Barack Obama turns 54: The US President's best put downs to celebrate his birthday
Is Britain really full up? Are migrants taking our jobs? Leading academic answers the most common anti-immigration claims
Calais Migrant Crisis: Deputy Mayor of Calais labels Cameron's use of 'swarm' as 'racist' and 'ignorant'
Chris Leslie: Jeremy Corbyn's anti-austerity agenda will harm the poor, says Labour shadow Chancellor
Landlords renting properties to illegal immigrants to face up to five years in prison
While we fixate on Calais, the Home Office is quietly deporting dozens of migrants on 'ghost flights'
Labour leadership race: Jeremy Corbyn could be the next Prime Minister, says Ken Clarke
iJobs Money & Business
£35 - £50k DOE: Guru Careers: A Tax Manager / Accountant (ACA / CA / CTA) is n...
£35000 - £37000 per annum + benefits: Ashdown Group: Contracts Executive - Cit...
£20000 - £25000 per annum + OTE £45K: SThree: SThree Group have been well esta...
£21000 per annum: Recruitment Genius: This is an exciting opportunity to join ...
Day In a Page
Built on a former chapel site, this impressive four-bedroom home boasts balconies, stunning views and contemporary modern living.
This three-bedroom house is situated in a quiet mews and set over three floors. Features include glazed staircases and high ceilings.
A period townhouse set over four floors, this five-bedroom home was built in the 18th Century and retains many original features.
With five bedrooms, this spacious home offers beautiful gardens and modern interiors - set within the popular market town of Bingley.
Set sail for this four-bedroom farmhouse in Cowes. With five acres of land and an indoor pool, this home oozes character. There is even potential to let a one-bedroom annexe.
A few miles from the seaside at Perranporth, this four-bedroom farmhouse sits amongst nine acres of idyllic grounds - including a lake and two barns used as holiday lets.
In the pretty market town of Bungay, this grade II-listed Mill House is arranged over four floors, offering four bedrooms and three reception areas.
This first-floor flat comes with two bedrooms, an impressive open-plan reception room and two lovely roof terraces.
This five-bedroom home comes with a range of outbuildings including a large barn which could be converted into a self-contained granny-flat or rental.
Moored at Taggs Island and reached via a pretty garden, this two-bedroom houseboat has a vaulted reception room and skylit garden studio - currently a beauty salon.
On the edge of the city, this six-bedroom home comes with an outdoor swimming pool and a large garage block that has annexe potential.
A contemporary house spread over three storeys, this three-bedroom detached home has large sliding doors that open out to the River Quaggy.
Moored in Chelsea's Cheyne Walk, this houseboat offers two double bedrooms and a teak deck that's ideal for al-fresco dining.
This former village bakery, dating back to the 17th century, is now a three-bedroom detached home just a few miles from the East Sussex coast.
On the picturesque Isle of Man, this four-bedroom character home has a ground-floor shop that's currently run as a newsagents and a flat that would make an ideal holiday let.
In a new collection of flats, this first-floor two-bedroom apartment offers ample entertaining space and a prime view of Furze Green from a private balcony.
This three-bedroom stone-built cottage currently trades as the village store with a restaurant in the annexe and family accommodation on the upper floors.
Previously two semi-detached properties, this five-bedroom home is spread over three floors with a large breakfast kitchen, orangery, office and gym on the second floor.
This five-bedroom home enjoys countryside views over the Blyth estuary to Southwold, offering flexible living space with a ground-floor annexe - ideal for use as a holiday let.
Close to the market town of Eye, this four-bedroom detached home offers a double-height living room which takes the place of the original, 19th-century, chapel nave.
Dating back to the 19th century, this four-bedroom home needs modernising. Spanning three storeys, the red-brick house has a fireplace, a small terrace and a cellar.
Just outside of Cambridge, this single-storey home offers three double bedrooms, a living room with vaulted timber ceiling and ladder steps that lead to a mezzanine study area.
This six-bedroom Georgian home is on three floors with open fireplaces, a two oven Aga, an annexe, and cottage gardens with outbuildings and a car barn.
A former coach house, Glebe Farm Stable is now a three-bedroom cottage with a double car barn, an attached office, kennels and an outbuilding that's currently used as a gym.
Located beside an impressive Victorian viaduct, this four-bedroom home has an open-plan living area that is glazed on two sides, with skylights and high ceilings.
A former furniture workshop, this three-bedroom home has high ceilings and painted brick walls, in a village setting only fifteen miles from the coast.
This five-bedroom stone townhouse features a pine staircase and an Inglenuk fireplace, double doors from the lounge give access to an enclosed courtyard.
This five-bedroom, detached home blends traditional and modern design; the sleek kitchen features a gas hob and oven set within an exposed chimney breast.
Capitalise on the fabulous views of Trevone Bay by taking two homes and creating one spacious boutique B&B. Just a cliff-top walk from Padstow.
Surrounded by woodland, this five-bedroom manor house has plenty of outdoor storage space in the form of three converted loose boxes, two smaller outhouses and a woodstore.
This six-bedroom home is set amongst three acres of grounds. Currently a large family home, Clift Hill has potential to make a B&B or countryside retreat, subject to change of use permissions.
This Grade II-listed three-bedroom home is situated on a private road, just a short walk from the sandy beaches of Frinton-on-Sea.
Less than five miles from Malmesbury, this four-bedroom cottage comes with equestrian facilities and gardens that extend to approximately three acres.
Spanning three storeys, this late-Victorian five-bedroom farmhouse is a spacious family home with a modern interior and B&B potential.
With an original church arch, this triplex one-bedroom church conversion has a light, spacious, feel and comes with a secure off-street parking space.
This recently-refurbished three-bedroom home has bi-folding doors that lead out to a decked seating area - ideal for alfresco dining this summer.
Well-located for coastal walks and popular restaurants, this detached four-bedroom home offers views over farmland, to the Solent, the Purbecks and Bournemouth.
If you love high ceilings, school conversions like this one are bang on the money. This two-bedroom flat is minutes from Burgess Park and the foodie haven at Borough Market.
Set within a church conversion in Bermondsey, this two-bedroom maisonette combines existing features, such as original arches and brickwork, with a contemporary finish.
This four-bedroom Edwardian home offers a combination of original features and contemporary design after a renovation by the current owners.
This four-bedroom home offers a vaulted ceiling in a breakfast room that's ideal for summer entertaining with doors that open to the patio and garden.
On the market for the first time in more than 50 years, this six-bedroom home is a project with vast potential - spread over three floors of living space.
Surrounded by rolling countryside, this four-bedroom barn conversion comes with a self-contained, one-bedroom annexe that could serve as an office or a holiday let.
Located near Harrogate town centre, this five-bedroom Victorian terrace is arranged over three storeys while a current study serves as an optional sixth bedroom.
A ground-floor flat in a country house, located a mile from Sway; this two-bedroom home would make an ideal weekend retreat on the edge of the New Forest.
On a popular residential lane in Caterham on the Hill, this four-bedroom family home offers a secluded garden and a convenient location for local schools and public transport.
Just a short walk from Westerham green, this three-bedroom cottage has a light kitchen with exposed brickwork and double doors that lead to a south-facing garden.
In a prime spot opposite the River Thames, this one-bedroom flat has an 18sq ft reception room with glass doors that open out to a private terrace.
Set in the hills above Llanwrda Village, west Wales, this 18th-century three-bedroom farmhouse has holiday-let potential from a separate barn conversion and annexe.
This charming end-of-terrace townhouse is arranged over three floors, with two double bedrooms and a private courtyard garden located at the rear of the property.