From The Herald by DOUGLAS HAMILTON August 23 2008
Marketing Management Services International (MMSI) announced yesterday that it has submitted a bid for Cains Beer Company, a regional brewer based in Liverpool that called in administrators earlier this month.
Glasgow-based MMSI, a management and investment group, would not disclose how much it had offered for Cains, but its managing director Gerald Michaluk told The Herald the bid was "massive", dwarfing the purchase of the the Isle of Arran Brewery that MMSI made about two months ago.
He added: "This is the biggest bid that I have ever made. I am quite confident that it will go through."
Michaluk said he is working with a group of Scottish investors including banks but he would not reveal their names.
He told The Herald in an earlier interview that he wanted to expand his activities in the brewing sector.
Cains has a landmark brewery in Liverpool and more than 100 pubs, inns and other establishments across northern England. Of these, about 85 are leasehold.
Asked if he was buying the whole company, including the pubs estate, Michaluk replied: "Yes. We are going for the whole shooting match."
He said Arran and Cains would be run as separate companies if the deal went through.
Michaluk and his backers are going to Liverpool next week to discuss the offer with the administrator, PricewaterhouseCoopers (PwC).
In early August, Cains Beer called in PwC after talks with Bank of Scotland to renew the Merseyside group's banking facilities came to nothing.
The board said at the time that it had been "unable to successfully conclude those discussions and accordingly it had determined that it would be appropriate in the circumstances to place the com- pany in administration with immediate effect."
Losses at the company, which operates pubs across north-west England and whose beer is sold by supermarkets such as Wm Morrison and Asda, widened to £4.6m in the six months ended April 27 from £691,000 last time.
The deadline for bids for the business ended at noon yesterday.
Brewing industry sources said several other offers for Cains were expected to be lodged with PwC.
Ajmail and Sudarghara Dusanj, two brothers from the Merseyside area, have been tipped by industry insiders to buy the brewing and canning business, while PwC has received "dozens" of approaches for other parts of the business.
Marston's is also thought to be a candidate to buy the brewery because of its interest in regional beers. The company has expressed some interest in acquiring the Liverpool brewer but has not said if it would make a formal offer.
The Dusanj brothers, who rescued Cains in 2002 and then oversaw a reverse takeover with Honeycombe Leisure last year, are believed to own the brewery freehold. According to the Morning Advertiser, a pub industry website, Cains had been paying about £500,000 a year to lease the brewery.
Cains produces up to 1650 cans of lager and beer every minute at its state-of-the-art canning plant. The brewery produces beers such as Asda's own-label Pilsner as well as its Smart Price lager and bitter lines. It also manufactures its own products, which include Cains Lager, Finest Bitter and Cains Bock.
The 30 or so freehold pubs within the business are thought to have attracted the most interest.
The Dusanj brothers also own the freeholds of about 10 pubs leased to Cains, and are expected to regain control of these houses.
PwC is understood to have closed a number of pubs that were losing money. Cains has won a number of awards for its beers and its lager is the official tipple of the Liverpool European Capital of Culture 2008 event. The company also sponsors the Tate Galleries.
Back to news articles