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CASTLE MALTING NEWS in partnership with www.e-malt.com Greek
23 May, 2006



Brewing news UK: Brewer Young's to merge with East Midlands rival Charles Wells

Young & Co’s Brewery is today expected to end more than 400 years of brewing heritage by shifting production of its ales from Wandsworth, southwest London, to Bedford, The Times has learnt May 23.

The company, which is selling its historic Ram Brewery site for redevelopment in an expected £80 million deal, has formed a joint venture with Charles Wells, the family controlled Bedford brewer, which will assume ownership of such beers as Young’s Bitter, Young’s Special and Waggle Dance.

The joint venture, which has already been registered at Companies House, has been dubbed Wells & Young’s Brewing Company. It will assume ownership of both companies’ beer portfolios, as well as all brewing, wholesaling and distribution of those brands.

Young’s, whose wine business will also be part of the venture, will have a stake of about 40 per cent. The balance will be owned by Charles Wells, which is contributing its Eagle Brewery in Bedford.

Young’s announced more than two years ago that it was discussing the future of its 5½-acre site with Wandsworth Borough Council. The council indicated that, as part of a wider redevelopment of the town centre, it would consider changing the designation of the site to allow it to be converted to office and residential use.

At the time of the original announcement, John Young, the group’s octagenarian chairman, had insisted that he was committed to brewing within the borough of Wandsworth. However, the cost of finding a suitable site and the poor economics of building a new brewery prevented such a move.

Last year, Young’s held advanced discussions with Multiplex, the developer of the new Wembley Stadium, about a possible £100 million deal for the site. It is understood that those talks fell through and that Young’s is now close to agreeing a fresh deal with an unnamed property developer involving an outright sale for about £80 million.

Young’s, which is due to report its full-year results on May 26, is expected to signal its intention to use some of the cash to invest in its portfolio of 208 pubs. There are suggestions that it could also return some of it to sharehoders.

Charles Wells, which unlike Young’s operates from a modern brewery, was founded in 1876 and moved to its existing site a century later. Its managing director, vice-chairman and retail marketing director are all fifth-generation members of the Wells family.

Its beer brands include Bombardier and Eagle IPA. It also produces Red Stripe, of Jamaica, and Kirin, of Japan, under licence and has the UK distribution rights to Corona Extra, one of the world’s biggest beer brands.

The combined volumes of the two companies’ own brands will come to about 400,000 barrels, with Young’s accounting for about a quarter.

The decision by Young’s to move the brewing of its ales to Bedford is bound to cause an outcry among its loyal army of real ale drinkers.

Young’s Bitter may not have quite the same broad consumer appeal as the easier-drinking London Pride, produced by its London neighbour Fuller, Smith & Turner, but it has an almost messianic following within its South London heartland.

While the move probably will result in the Young’s dray horses being put out to pasture, there is no reason why even the most hardened Young’s drinker should notice any difference this year. Some of the country’s best-known ales are now brewed many miles from their spiritual homes.

One of the most successful moves has been WH Brakspear & Sons, whose historic brewery in Henley-on-Thames is now a trendy hotel. Its beer brands were sold to Refresh UK, which erected the old Brakspear brewing equipment at its existing Wychwood Brewery in Oxfordshire. In the two years since the move, sales of Brakspear draught ales have risen by 40 per cent.

Six years ago, Greene King moved Old Speckled Hen to its Suffolk brewery from Morland in Oxfordshire. More recently, Wolverhampton & Dudley Breweries took over production of Bass Ale under contract from InBev, the Belgian owner of Stella Artois lager. Experts reckon that both ales have improved.

It is understood that Ken Don, Young’s head brewer, has been working at the Eagle Brewery already to ensure that, from the point of view of taste, the move results in a similarly seamless transition.

The Campaign for Real Ale (CAMRA) has expressed its shock and disappointment at the news Young’s is to close its Ram brewery in Wandsworth.

Young’s announced its plans to enter into a joint brewing venture with Bedford’s Charles Wells by October.

CAMRA Chief Executive Mike Benner said: “We have known for some time that Young’s could not continue at its present site, but we held out hope that efforts to find a suitable local alternative would bear fruit and not spell the death of more than four centuries of brewing tradition in Wandsworth.

“CAMRA wants assurances that every one of the beer brands produced by both Young’s and Charles Wells will have a secure future, and that the identity of Young’s 208–strong pub estate and Charles Wells’ 248 pubs will be safeguarded.

“We would also urge Young’s to be upfront about where its beers are brewed and not try to pass itself off as a London brewery. It is a tremendous loss for London drinkers and a great shame that there is only one substantial real ale brewer left in the nation’s capital in the form of Fuller’s.”

CAMRA’s London Regional Director Steve Williams said: "I am greatly disappointed that London and Wandsworth will be losing their flagship brewery. Another great brewery that has produced fine beers for hundreds of years is lost in the name of progress.

“However, looking forward, I am hopeful that the Young's beers out of Bedford will prove to be as tasty and first rate as those that have quenched the thirst of London's beer drinkers for many years."





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