What a long strange trip it has been in. Finally, after many possible suitors and much drama, Scottish & Newcastle was acquired today by Carlsberg of Denmark and Heineken of the Netherlands in a $15 billion deal.
The two companies plan to break up Scottish & Newcastle and here in the US, Heineken USA will obtain the rights to the fast growing and high margin Newcastle Brown Ale from Scottish & Newcastle Importing.
But this is a deal that is not just about coping with mature, slowing markets in the West. It’s also about beer’s future in the East-in Russia, in particular.
Vodka may still reign in Russia, but sales of beer have been climbing steadily in recent years, especially among younger drinkers. And there is still room to grow. As part of the deal, Carlsberg will gain total control of a joint venture with Scottish & Newcastle in Russia, Baltic Beverage Holding.