S&N has made an impact with its marketing

A handful of giant companies - such as Heineken, Interbrew, Anheuser-Busch and South African Breweries - constantly circle ready to pick off punier rivals.

After a string of high profile acquisitions, Scottish and Newcastle likes to think it is now a member of the big league.

But as it gears up for an ambitious �2bn expansion, the British company must still avoid being stung.

Valiant effort

S&N plans to auction off its entire pub, hotel and restaurant estate to fund expansion in brewing.

This is not a new game to us - we are already Number One in a number of markets around the world Linda Bain, Scottish & Newcastle

News of the �2bn ($3.2bn) sale sent the company's share price soaring.

Not necessarily because investors liked the idea of the Edinburgh-based group staking everything on beer but because investors believe the sale will make the company a more attractive takeover target, analysts said.

S&N, for its part, believes the plan will complete its transformation into a major global player.

It has valiantly kept faith with beer at a time when most of its UK rivals - such as Whitbread and Bass - have bailed out of brewing altogether, amid a declining market.

"The difference between us and those companies is that we are an international brewer," S&N's Linda Bain said.

"This is not a new game to us. We are already Number One in a number of markets around the world, including France.

"We are already competing very strongly with Heineken, Interbrew and the others."

Poor track record

Scottish and Newcastle may be doing its best to the fly the flag in the international market.

But previous attempts by British brewers to expand abroad have ended in failure and retreat.

Bass came to grief in the Czech Republic and China before its exit from brewing.

Although Britain is still one of the world's biggest markets for beer, it has a poor track record of producing convincing national champions.

Competition law and the fondness of politicians for meddling in the market has arguably prevented the UK's brewers from achieving the sort of scale that would allow them to compete on the global stage.

Small beer

Beer sales are also in decline in the UK, although shrewd marketing has helped some brands buck the downward trend.

I think in many instances they can compete with the big boys. Brewing analyst

None of this has prevented S&N from pursuing its ambitious expansion plans.

Three years ago it swallowed up Kronenbourg, France's top-selling beer.

Last year, it acquired a 50% stake in Russia's biggest brewer for �1.2bn, by buying Finland's Hartwell.

It is a now major player in Europe, with three of the top 10 beer brands.

But it remains relatively small beer in global terms.

Gaining ground

In 2001, S&N ranked 15th, with 1.6% of the world market, according to analysts Euromonitor.

That compares with 8.9% for Anheuser-Busch, 5.2% for Interbrew and 5.1% for Heineken.

S&N's biggest-selling brand, Kronenbourg, ranked 44th with 0.4% market share, compared with Budweiser's 3.5%.

Interbrew's Stella Artois, Kronenbourg's main rival in the UK, had a global market share of 0.6%.

There is no doubt that S&N is gaining ground fast.

It is reported to be lining up bids for Italy's Peroni and Holland's Grolsch, among others.

But the real prize must be Denmark's Carlsberg, the acquisition of which would catapult S&N into the top five, making it a true global force to be reckoned with.

S&N is also understood to have Carlsberg in its sights.

The only danger is that it will be swallowed up by one of its larger rivals before it can achieve its aim.

Proving itself

A couple of years ago, Anheuser- Busch was rumoured to be lining up a bid for the British company.

But the US giant has said it is concentrating on its home market.

Other potential purchasers - such as Interbrew or Carlsberg - may be deterred by competition law in the UK and Europe.

S&N has also shown that, on the whole, it can make a go of its foreign acquisitions.

One beer analyst, who did not want to be named, said: "Scottish and Newcastle has proved itself quite well in recent years.

"The Hartwell acquisition appears to have been a good move."

He added: "I think in many instances they can compete with the big boys.

"But the danger is that they will end up overpaying for their acquisitions."