France: Brasseries Kronenbourg is planning restructuring

Scottish & Newcastle plc announced on February 16 that its French subsidiary, Brasseries Kronenbourg, has begun consultation with its workforce over the proposed restructuring of its brewing business.

The project includes:
-- The proposed sale of Champigneulles brewery near Nancy;
-- Focus on premium brands and operations at Obernai brewery near Strasbourg

Scottish & Newcastle said: “An update on the consultation process will be provided in due course.”

Champigneulles has about 350 employees and capacity for 3.2 million hectolitres.

Obernai brewery employs around 650 and has the capacity to produce 6.5 million hectolitres, has one keg line, eight bottling lines, and two canning lines. It produces the French unit's premier brands, including Kronenbourg 1664, Fosters and Carlsberg.

S&N divided its beer business into four parts in May 2004. The UK business Scottish Courage, headed by John Dunsmore, remained unchanged, and three new international divisions – France, Asia and greater Europe and the US – were created.

Brasseries Kronenbourg is the leading brewer in France with a market share of around 40%. S&N acquired it after entering into a partnership with Danone in 2000. Under this arrangement, S&N took management control and Danone had a "put" option to sell its stake in the partnership to S&N by April 2003. In 2002, Danone gave notice to S&N it would exercise the "put", giving S&N 100% ownership of the business.