Courage buys Barclay Perkins

There’s no such thing as a brewery merger, no matter how it’s spun at the time. One party is always effectively the buyer.

You can see that the deal between Courage and Barclay Perkins was reported as a merger. But within 15 years Barclays Perkins’ brewery was closed and their name had been dropped from the company’s title.

“Big brewery merger in prospect
Courage and Barclay Perkins
Notes from our City staff —Friday Evening
The preliminary stages of an important brewery merger were announced today. The boards of Courage and Co. and of Barclay Perkins and Co. state that they have agreed in principle to the desirability of a merger by the formation of a holding company to acquire the share capitals of the two companies.

An independent firm of chartered accountants Peat, Marwick, Mitchell and Co., has been instructed to prepare a report with a view to advising the respective boards as to a suitable basis for such a merger.

Issued capital of Barclay Perkins is £2,911,000, and of Courage £3,540,000. At December 31. 1953, assets of the last-named group totalled £13,417,000, and at March 31, 1954, the assets of Barclay Perkins amounted to £12,948,000. The two groups, whose headquarters are in London, have a large trade there and in the home counties.
Yorkshire Post and Leeds Intelligencer - Saturday 12 February 1955, page 7.

I’m interested to see that, on paper, the two companies were of a very similar size, especially in terms of assets where there was only half a million quid difference.

Not only were the two companies both headquartered in London, their breweries were less than a mile apart. No surprise then that one was closed. Probably more surprising that part of Barclay Perkins stayed open as long as it did. The main brewery closed in 1958, but the Lager plant continued brewing into the 1970’s*.

This is the deal they agreed:

“Brewery Merger.
Courage Co. and Barclay Perkins announce that report of independent accountants has been received which provides for formation of holding company to acquire capitals of companies on following basis:- Courage For £l00 5 per Cent. Cum. Pref. stock, £l07 10s in per Cent. Cum Pref. shares; for £l00 5 per Cent, 2nd Red. Pref., £l05 in 5 per Cent. Pref.; and for £3 of Ord., seven £1 Ord. shares. Barclays - For £l00 10 per Cent. Pref. stock. £215 in 5 per Cent. Pref. shares; and for each £1 Ord. stock, one £1 Ord. share. Recommendations have been approved by boards.
Dundee Courier - Friday 27 May 1955, page 2.

Interesting that the Barclay’s preference shares were worth double Courage’s, but their ordinary shares were worth far less.

It seems that the deal didn’t proceed that smoothly:

“Brewery merger to proceed
Amalgamation of the two big London brewery businesses of Courage and Co. and Barclay, Perkins and Co. will now be completed according to plan. This merger is to be effected through a new holding company formed under the title of Courage and Barclay, whose shares were offered in exchange for the shares of the two constituent concerns. The offer was made at the end of last May but early in August acceptances were well below the minimum 90 per cent, required to make it unconditional and the date was accordingly extended to October 29. This move has had the desired effect, as the announcement was made this evening that acceptances have now been received from holders of more than 90 per cent, of each class of capital of the two companies. Thus the offer becomes binding and allotment letters will be posted next Tuesday.
Yorkshire Post and Leeds Intelligencer - Wednesday 19 October 1955, page 13.

I wonder which company’s shareholders held up the deal? Or was everyone just on holiday?



* "A Century of British Breweries plus" by Norman Barber, 2005, page 85.