Arnault may seek brewing and food sale
Wednesday 30 July 1997
Mr Arnault's aim is to create a pounds 15bn combined wines and spirits business comprising the Moet Hennessy part of his LVMH group, the IDV drinks arm owned by GrandMet and the United Distillers business of Guinness. Under his original proposals Burger King and Pilsbury and Guinness' brewing arm would be demerged.
However LVMH's advisers, BZW, have already been contacted by several investment banks and rival companies expressing an interest in buying Guinness' brewing arm, and Pilsbury and Burger King. BZW has not ruled out trying to broker a deal as an alternative to demerging the businesses.
Mr Arnault would, the sources added, also be willing to accept a deal whereby Burger King and Pilsbury were kept together as one company which would then be demerged from the combined spirits group.
GrandMet and Guinness have complained that demerging the non-spirits businesses as three separate companies would lead to a tax bill of pounds 1.5bn, and that the alternative proposals would still lead to a substantial tax bill. However, Mr Arnault's camp believes keeping Pilsbury and Burger King together would substantially reduce any tax liabilities.
Analysts believe there would be no shortage of buyers for the demerged businesses. "Guinness Brewers is one of only a few worldwide brands and is the most likely to attract bidders. There would be great synergies with Anheuser-Busch, the US brewer of Budweiser. Carlsberg and Heineken would also be interested," said one leading drinks analyst yesterday.
Food analysts believe US food groups such as Campbells and RJR Nabisco are most likely to be interested in Pilsbury and Burger King. Unilever, the Anglo-Dutch food conglomerate, would also be in the frame.
Mr Arnault is continuing to lobby GrandMet's shareholders this week in an attempt to gain enough support for his original plans to scupper the straight merger with Guinness. However one institutional shareholder said yesterday: "We have yet to be convinced by Mr Arnault."
Separately, Burger King announced yesterday it was pulling out of France, putting more than 1,000 jobs at risk.
"We have decided to shut the business due to the sustained very lower level of profitability," a spokesman said.
- 2 Top Gear: Jodie Kidd, Philip Glenister and Guy Martin 'in advanced talks' to join show
- 3 General Election 2015: 14-year-old boy asks Nick Clegg – 'can you kill Katie Hopkins?'
- 4 University student in court for allegedly covering housemates' food in window cleaner and spit
In defence of liberal democracy
The Rothschild Libel: Why has it taken 200 years for an anti-Semitic slur that emerged from the Battle of Waterloo to be dismissed?
General Election 2015: UK will be 'run for the wealthy and powerful' if Tories retain power, Labour warns
General election live: SNP suspends two members for disrupting Labour rally
Schools forced to act as 'miniature welfare states' with teachers buying underwear and even haircuts for poor pupils
Andy McSmith's Sketch: Feisty audience is the real star of an enlightening show
iJobs Money & Business
£20000 - £25000 per annum + Uncapped commission: SThree: Can you speak German,...
£25000 - £30000 per annum + benefits: Ashdown Group: An exciting opportunity f...
£215 per day: Ashdown Group: Junior Project Manager (website, web application ...
£40-50K: Guru Careers: We are seeking an experienced Software Engineer / Softw...