Milk rivals to lock horns again over new branded drink

Published on Sunday 29 September 2002 01:00

ROBERT Wiseman Dairies and Express Dairies, the rival milk suppliers currently at loggerheads over alleged anti-competitive practices in Scotland, are set to lock horns again.

The two giants of the industry are understood to be vying to get involved with a tiny company that aims to turn milk into an upmarket branded drink.

City sources say Wiseman and Express are in talks with Branded Drinks plc, which is planning to join the OFEX market later this year brandishing a new drink known as "M... ".

The drink is to be supplied to convenience retailers such as Pret a Manger and Starbucks, as well as health clubs and supermarkets.

Branded Drinks said it was close to agreement with two milk suppliers, although it declined to reveal the names.

It has also received an offer to market and distribute "M… ", which it believes will command a premium price as an added value product.

In addition, Branded Drinks is expected to announce its first deal with a high-profile retailer within the next few weeks.

The company has emerged from former OFEX-quoted health club operator Fit Stop, and investors appear to like the "M… " idea. Strong demand has prompted Fit Stop to increase the minimum amount of money to be raised as part of a deal to acquire soft drinks concept firm Rebrand Ltd and sell its health clubs business.

The company is now re- naming itself Branded Drinks and re-listing on OFEX with a minimum offer for subscription of 250,000. Run by Renwick Haddow and Mark Wilkins, the company is hoping to raise up to 450,000.

Haddow said: "We are delighted to have reached the minimum subscription as quickly as we did in these tough markets. It shows that our existing and new shareholders believe that moving into the chilled drinks market gives them an excellent investment opportunity."

He added: "Our aim at Branded Drinks is to move milk from a commodity to an added value drink, as has happened with bottled water. We want "M… " to do for the milk industry what Perrier did for the water industry."

Wiseman and Express renewed hostilities on Friday when Express said it would contest a decision by the UK’s consumer watchdog clearing Wiseman of abusing its dominant position in Scotland.

Claymore Dairies, a subsidiary of Express, said it was appealing to the Competition Commission Appeals Tribunal against the recent ruling by the Office of Fair Trading.