Bass poised to win Beer Orders race

John Shepherd
Sunday 16 August 1992 23:02

BASS looks set to be the first big brewer to beat the November deadline for complying with the Government's Beer Orders, requiring them to free of tie half the number of pubs owned above a ceiling of 2,000.

Whitbread and Allied-Lyons are tipped to be second and third. All are expected to beat the deadline.

Bass, Britain's biggest brewer, has sold 2,600 pubs since July 1989. It has agreed to sell another 100 pubs, leaving just 40 to go.

The priority at Bass has been to sell pubs rather than lease them to other pub operators.' We have not gone down the free-trading route, because we are not a property group,' a spokesman said.

Whitbread has 250 pubs left to dispose of, while Allied has to untie 200. However, Allied has the additional problem of overcoming initial objections by the Office of Fair Trading to a leasing and beer supply deal on 734 pubs with Pubmaster, owned by Brent Walker.

Earlier this year the OFT warned Allied that the 734 pubs might not be deemed free of the tie in November because it had agreed to supply more than half of Pubmaster's beer requirements. Despite initial threats by Allied to challenge the OFT in the courts, the deal is expected to be approved.

'The talks have yet to come to a conclusion,' a spokesman for the OFT said, but he hinted that a compromise was not too far away. 'It is getting to a point where the pubs can be declared free.'

In all, Allied, which had to untie 2,400 pubs, has sold 1,300 and leased 900, which includes the 734 covered by the Pubmaster deal.

Whitbread hopes to confirm that it has conformed to the legislation by the middle of next month. The brewer has had a more difficult time than the others because most of its pub estate is in the South and South-east, where property values have been especially depressed.

Whitbread has sold 1,000 pubs and put another 1,000 on short- term, non-beer-supply leases, enabling it to sell at higher prices if property prices recover.

The final table will see Bass with 4,500 tied pubs, Allied with 4,400, and Whitbread with 3,700. In all, about 11,000 pubs have been untied across the industry.

The shake-up has cost the industry about pounds 500m in losses on disposals and other items, excluding the cost of management time.

Join our new commenting forum

Join thought-provoking conversations, follow other Independent readers and see their replies

View comments