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Netherlands: Dutch brewer Heineken said on Wednesday, July 21 2004, it was looking "with interest" at the proposed merger of Coors and Heineken's Canadian partner Molson, but a spokeswoman declined to comment on media reports that it might make its own bid for Molson. "That's just speculation", she said. Broker SNS said the Coors-Molson merger talks were important for Heineken because it affected its position on the Canadian market and in Brazil, where Heineken and Molson jointly own Kaiser, according to Reuters.

But Heineken declined to comment on media reports that the Dutch firm might seek to buy out its partner in Kaiser or even be tempted to spoil the Coors-Molson merger with a counter bid. "Molson is a partner of Heineken, that is what we said in 2002 when we signed a 10-year agreement. But it is too early to speculate on what will happen now," she said.

Heineken took a 20 % stake in Kaiser after Molson bought the Brazilian brewer to combine it with the Bavaria branded business that it already owned there -- unrelated to a Dutch brewer of that name.Molson also distributes Heineken beer in Canada and Heineken Chief Executive Anthony Ruys has praised their "excellent relationship".

The Wall Street Journal said on Wednesday that Coors and Molson would announce a $6-billion merger as early as Thursday, after the two companies said earlier this week that they were in talks an a merger, which would create a powerful international rival to SABMiller and Anheuser-Busch.

Molson is 55-% owned by the family that founded it 218 years ago, but in June Deputy Chairman Ian Molson quit after a dispute with Chairman Eric Molson and the family may not vote in one block in favour of a merger.

Heineken shares were up 0.6 % at 25.86 euros at 0944 GMT on Wednesday after a 6.4 %rise so far this year and an 18 percent drop in 2003.

Faced with sluggish sales and the impact of a lower dollar on its profits, Heineken is busy integrating Austrian brewer BBAG and expanding in the Asia-Pacific region with a stake in Guangdong and a deal with Australia's Lion Nathan.

While Heineken is focusing on cutting debt after the 1.9-billion-euro ($2.35 billion) BBAG purchase, its balance sheet is comparatively strong.

At the end of 2003, it had debts of 3.76 billion on group equity of 3.8 billion euros, while it generated 2.08 billion in cash from operations. It also has a bank credit facility of 1.2 billion euros that will expire in 2008. The debts include 1.1 billion euros in eurobonds expiring in 2010 and 2013.


23 July, 2004