Can Young's afford its tradition?

THE feud has become the stuff of legend. It has been long, bitter, and at times quite bizarre. But at last it seems that the battle between traditionalists running the 174-year-old brewer Young's and the hardheaded City people at Guinness Peat Group is drawing to a close.

Many will be disappointed if this marks an end to the feud, which has ensured a great deal of entertainment at annual general meetings at Young's Ram brewery in south London.

Each year, investment company GPG, the biggest shareholder in Young's and chaired by Kiwi corporate raider Sir Ron Brierley, would demand that the management make changes to boost value for its shareholders. And each year, GPG's representative would be shouted down by loyal shareholders led by irascible chairman John Young, now 83, who drove his point home with a strange collection of props including bee-keeping gear, boxing gloves and a megaphone.

Young's epitomises the traditional brewer. Its ales include Waggledance, Double Chocolate Stout and Winter Warmer, and its brewery complex has stabling for ten dray horses that make daily deliveries to pubs in the local area.

But tradition and profits rarely seem to mix, and the people at GPG made it clear that they expected better rewards from a listed company worth £160m. Now they might get their way.

A feasibility study commissioned by Young's into the possibility of selling the Wandsworth site and relocating is about to be completed. The sale could raise £100m and shareholders will soon be voting on whether to accept the plan.

While the outcome is still up in the air, sources close to the company say it is 'unlikely' that the board will be able to turn its back on a massive cash windfall by recommending that Young's stays put.

GPG will certainly raise a glass to that. 'We would be supportive of any move, such as a property deal, which would unlock value,' said a spokesman. 'We have always said that there is a fantastic amount of value in the business and have been putting pressure on the company to this end for ages.'

When Young's moved to its present site in 1851, 20 years after the business started, Wandsworth was an unremarkable town on the banks of the Thames. Now it has been swallowed up in London's expansion and the brewery has become marooned in the middle of a major road system, which sees 90,000 cars roar past every day.

Luckily for Young's, Mayor Ken Livingstone has decided that Wandsworth is ripe for regeneration, leaving the company sitting on valuable real estate.

Young's is starting to take the idea of a move seriously. Traffic congestion means getting in and out of the site is difficult not only for the lorries, but also for the dray horses.

John Young, the great-great-grandson of the founder, said: 'In purely nostalgic terms, no one would be more sad than me if this continuity were to be broken, but the fact must be faced that if it is in the interests of the company and its shareholders, and ultimately of our loyal customers, to build a new brewery, then that is what we must do. It's the beer that counts, not where it is produced.'

If finding a suitable site nearby proves difficult, one option would be to keep the company's offices in London and move the brewery operations to the West Country, where Young's also owns pubs.

Even Camra, the Campaign for Real Ale, can see the sense in the scheme. 'Young's is basically set on a traffic island and the area is ripe for development,' said research manager Iain Loe.

'But if Young's moved out of London, it would lose a lot of its identity and would lose out financially, too. Its local following is part of its success.'

With their eyes fixed firmly on a potential multi-million pound windfall, such sentiment is unlikely to concern shareholders.

History on tap ...

? TRADITIONAL draught beer has been produced on the site of the Young's brewery since 1851, which makes the Ram Brewery the oldest site in Britain on which beer has been brewed continuously.

? YOUNG'S dray horses pull the Lord Mayor's coach at the annual parade. As well as the horses, the Ram Brewery is home to the company mascot, a ram named Ramrod. There are also ducks, geese and a peacock.

? THE Queen visited the brewery in 1981 to celebrate the company's 150th anniversary.