Whitbread deal sparks probe calls
Pub mergers prompt fears for consumer choice
Sunday 30 May 1999
The Office of Fair Trading is set to launch an inquiry following the announcement of Allied Domecq's plan to sell its 3,600-strong pub estate to Whitbread. There is concern that the deal, which would leave Whitbread with more than 7,000 outlets, is concentrating pub ownership in even fewer hands.
In addition, Whitbread's plan to dispose of its brewing interests is expected to lead to further concentration of production. This consolidation has reached such a peak that many industry figures are drawing parallels with the situation in the late 1980s, when the dominant influence of the big six brewers prompted the Government to introduce the Beer Orders to dilute their power.
Philip Shaw, an analyst at Panmure Gordon, said: "The Government has not looked at the way that companies acquiring huge numbers of pubs can tie tenants into tight supply agreements."
His is one of a number of voices calling for an update of the Beer Orders, which are generally judged to have failed to prevent restrictive practices in the industry.
The Office of Fair Trading will decide next month whether to recommend an investigation by the Competition Commission, formerly the Monopolies & Mergers Commission.
The Campaign for Real Ale has already asked for a referral, and the OFT is seeking submissions from other interested parties.
The 1989 Beer Orders forced the big brewers to sell many of their pubs to reduce their influence. However, the rules only apply to companies that also brew beer. There is no limit to the number of pubs that emerging pub companies like Punch Taverns, Pubmaster and Enterprise Inns can own.
However, Giles Thorley, who runs the Unique Pub Company's 2,641 outlets, denies that the emergence of big pub companies has impaired choice. "Our pubs can choose from any of the top four lagers, Carling, Carlsberg, Fosters and Heineken," he said.
There is also concern that smaller, regional brewers are struggling to survive.
On Friday, East Anglia's Greene King announced an agreed bid for Morland of the West Country in a deal that is believed likely to mean the closure of the latter's brewery in Abingdon.
- 1 What happens to your body when you give up sugar?
- 2 Have sex with your iPad thanks to the new sex toy no-one asked for
- 3 The 'sex selfie stick' lets you FaceTime the inside of a vagina
- 4 Why you're almost certainly more like your father than your mother
- 5 Westboro Baptist Church couldn't picket Leonard Nimoy's funeral because they didn't know where it was
Durham Free School: 'Creationism taught at' free school facing closure
Nearly 100,000 of Britain's poorest children go hungry after parents' benefits are cut
End of the licence fee: BBC to back radical overhaul of how it is funded
Nigel Farage promises Ukip will not 'stigmatise' would-be migrants – and says he wants 'everyone to speak the same language'
Ex-head of MI6: 'We shouldn't kid ourselves that Russia is on a path to democracy'
Most people think legal tax avoidance is just as wrong as illegal tax evasion, poll suggests
iJobs Money & Business
£8 per hour: Recruitment Genius: This Pension Specialist was established early...
£30 - 35k + Bonus & Benefits: Guru Careers: We are seeking an Executive Assist...
£25000 - £30000 per annum + benefits: Ashdown Group: A global leader operating...
Voluntary post, reasonable expenses reimbursed: Reach Volunteering: Would you ...