S&N is a bid target for Carlsberg

On Tuesday, S&N said that Carlsberg had breached terms of the agreement for the jointly-owned Russian beer business, Baltic Beverages Holding (BBH).

The move comes after Carlsberg and Heineken said last week that they were considering a joint bid for S&N.

S&N said it was now considering whether to take full control of BBH.

The Edinburgh-based S&N also said it might seek a new partner for BBH, which is seen as one of S&N's most-prized assets.

Swift reaction

Last week, Carlsberg and Heineken announced that they were in talks about forming a consortium to buy S&N, the largest UK-owned brewing company whose brands include Foster's, Kronenbourg 1664 and Newcastle Brown Ale.

S&N BRANDS Kronenbourg Fosters Strongbow Newcastle Brown Ale John Smith's See S&N's share price

If Carlsberg and Heineken do make a bid, their plan is to split S&N between them.

Heineken would take control of S&N's main business in the UK and some other European markets, while Carlsberg would take over S&N's operations in France and Greece, and gain full control of BBH.

However, S&N reacted angrily to the bid plans last week, calling them "unsolicited and unwelcome".

On Tuesday, the brewer launched a counter offensive over the BBH business.

In a statement, S&N said: "The board believes that the actions of Carlsberg constitute initiation of the voluntary termination provisions of the agreement under which Carlsberg is obliged to offer its shares in BBH to S&N.

"The board is still evaluating whether the best interests of S&N shareholders will ultimately be served by outright ownership of BBH or through the introduction of a new partner(s) into BBH."

The firm added that it had been "content" with the joint ownership of BBH, and had wanted it to continue "for the long-term".

"However, given the breaches of the agreement by Carlsberg and their serious implications for BBH, the board of S&N has felt compelled to respond swiftly to protect its position," S&N said.

However, in a short statement, Carlsberg replied that it believed "the claims made have no merit".