Bitter blow for beer campaigners

BREWER Wolverhampton & Dudley has announced it is to buy smaller rival Jennings for £45.8m pounds. The deal values the 177-year-old northern brewer at 430p a share, and includes any final dividend that Jennings would otherwise have paid.

Wolverhampton & Dudley Breweries, which is facing opposition to the bid from real ale enthusiasts, reiterated its commitment to develop Jennings's historic Cockermouth brewery, which produces the award winning Cocker-Hoop ale as well as Cumberland Ale and Cross Buttock.

However, the Campaign for Real Ale has quickly mounted a push to halt the takeover since the companies revealed earlier this month that they were in talks. Mike Benner, Camra's chief executive, said the deal would be 'bad news for consumers and employees'. He had called on Jennings shareholders to reject the bid.

The offer represents a 32% premium to Jennings's share price before the takeover talks began two weeks ago.

Wolverhampton, which brews Marston's Pedigree ale in Burton-upon-Trent, Staffordshire, has so far received irrevocable undertakings to accept its offer from shareholders owning 26.85% of Jennings shares.

Wolves, which has expanded steadily over the last few years through a programme of selective regional acquisitions, already owns the Pitcher & Piano, Bostin' Locals and Service That Suits Me pub chains. It also brews Banks's, Hanson's and Mansfield beers in Wolverhampton.

Jennings also announced a 13.2% increase in pre-tax profits to £3.23m in the year to 26 February. Its 128 pubs, which contribute 67% of sales, increased operating profits by 13.2% to £6.1m.

The group's Cockermouth brewery in the Lake District increased sales of its lead brand, Cumberland Ale, by 4% to 4m pints. Pubs serving Jennings' beer are principally found in Cumbria with others scattered across the north west, the north east and parts of Yorkshire.

Wolverhampton shares moved 5p higher in early trading but retreated back to flat at 1,040p by mid-morning. Shares in Jennings were up 11p at418&frac;12p.