E-Malt.com News article: UK: Green King to criticise weakening of pub smoking ban in England

Green King, the UK brewer which has just bought Dunbar-based beer and pub group Belhaven,criticised the proposed weakening of the pub smoking ban in England to exclude clubs, The Herald reported on November 1.

The chief executive of Greene King, Rooney Anand said to The Herald : "It must be a level playing field. Giving clubs an advantage is frankly, in terms of what the government's stated objective is in long-term health policy management, a retrograde step."

Stuart Ross, Belhaven's chief executive, stated: "It is something we fought long and hard for in Scotland and to that extent the Holyrood parliament has got it dead right."

Anand and Ross were in Stirling on October 31 talking for the first time about the £187m acquisition which ended three centuries of independence for Belhaven and which has been lamented by some observers for its further erosion of Scotland's declining quoted sector.

Ross, whose shares were bought out for £893,000, stated: "My contract has not changed, I am the boss of Belhaven running the business in Scotland but instead of a reporting line to a plc board I agree objectives in Scotland with Rooney.

"I have a great team who are really committed to the business. They were not unsettled by it. They realise there is a huge opportunity here, and the response from trade customers has been first class. Of course, the consumer won't know the difference."

Ross added: "It is very much business as usual. It was not an acquisition to rationalise or asset strip the business but it reflected the growth prospects of Belhaven in Scotland.

"We are keen to expand the pub estate and grow the beers and drinks business, and the additional benefit of that is the opportunity to cross-trade the beers and bring up Greene King's award-winning cask ales to Scotland and take Belhaven cask and best beers south."
Anand said: "Our whole strategy is that we have bought a top quality business in Scotland. It gives us instant access into the Scottish market, national presence, and allows Greene King to grasp the opportunity to truly become a national player."

He stated the predicted cost savings of £13m over three years would come mainly from purchasing and back office efficiencies, not from eroding Belhaven's base, because of the vital need to preserve "the Scottishness of the business in the eyes of the Scottish licensed trade and drinkers".

The deal adds some 270 Belhaven pubs to Greene King's 2000-strong estate at a time of uncertainty over the effects of the smoking ban.

Greene King has said the ban in Scotland from March next year will have a "significant effect on short-term profitability".

Ross commented: "In most of our houses we can provide some form of comfort and shelter for those who require to smoke and in a few of the pubs we can extend the licensed areas, although that might take a bit longer because of plann-ing consents. It is up to us to try to get as much competitive advantage as we can by plann-ing ahead."

Anand stated the company's predictions were about "managing people's expectations" based on experience of a ban in Ireland. Ross said there was some evidence, in the second year, of a decline in people smoking outside pubs in Ireland and that "people are perhaps coming to terms with it".



04 November, 2005