McEwan’s Export brewer swallowed by Marston’s for £55m

McEwan's was once brewed in Edinburgh but is now made south of the Border. Picture: Toby Williams
McEwan's was once brewed in Edinburgh but is now made south of the Border. Picture: Toby Williams
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McEwan’s Export brewer Charles Wells has been snapped up by pubs and beer group Marston’s in a £55 million deal.

Marston’s, owner of the Hobgoblin and Lancaster Bomber ales, released details of the acquisition alongside its half-year results, which showed a 3 per cent rise in underlying revenue to £440.8 million for the 26 weeks to 1 April, despite the later scheduling of the Easter holidays this year.

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The acquisition of the Charles Wells brewing business – which bought the McEwan’s and Younger’s brands from Heineken in 2011 – will raise Marston’s ale market share up from 11 per cent to 16 per cent.

Marston’s said that Bedford-based Charles Wells will bolster its supply chain, offering new lager brewing and canning operations, and “opportunities to further improve efficiencies” in brewing packaging and logistics.

McEwan’s was once brewed at the Fountain Brewery in Edinburgh, founded by William McEwan in 1856. The brewery remained active until 2004, when production was shifted to the Caledonian Brewery on nearby Slateford Road.

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The brand passed to Heineken in 2008 after its purchase of Scottish & Newcastle’s British operations. Heineken sold McEwan’s to Wells & Young’s in 2011, with production moving south of the Border to Bedford.

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Chief executive Ralph Findlay said: “We are delighted to have agreed to acquire Charles Wells Brewing & Beer Business.

“It is a high quality brewing business offering us opportunities to extend our trading area in the south of England and Scotland, and brings a range of well-known and popular brands into our portfolio.”

The company has also agreed to buy up seven new pubs for £13m from an undisclosed national pub operator, which is on top of another three premium bars to be purchased for £8m from Pointing Dog.

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Marston’s said in its half-year earnings release that it also expects to open about 20 gastropubs, eight lodges and three premium bars this year – on top of its recent acquisitions.

The company said it has had a “solid start” to the second half of its financial year, thanks in part to the later scheduling of Easter, and is confident that it will reach annual targets.

Sahill Shan, an analyst at N+1 Singer, said: “Interims this morning are bang in line with our expectations, with profit before tax growth up 3 per cent to £33.7m.

“This modest growth partially reflects the fact that Easter has fallen into the second half this year and this typically is worth an incremental £1m at the profit before tax level.”

Shan said he expects no material change to this year’s forecasts for earnings per share, but is expecting a near 9 per cent jump for full-year 2018.

He added: “In a difficult sector Marston’s remains our core pick on steady growth and yield considerations.”

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