Wednesday lunchtime business bulletin

Scottish & Newcastle faces takeover bid; Coffee shop group Caffe Nero delivers leap in profits; Air France-KLM and US airline Delta unveils Heathrow flights to rival BA.

Brewing giants Carlsberg and Heineken today said they were considering a potential joint bid for Foster’s brewer Scottish & Newcastle.

Danish firm Carlsberg is looking to buy S&N’s interests in France, Greece and eastern European drinks business BBH, while Heineken would take on the UK business and other European operations.

The two companies said they were in talks over a potential cash offer, although they have yet to make a formal approach.

S&N’s shares jumped 15% following the news.

Coffee shop group Caffe Nero today delivered a 31% leap in profits as the business posted its first set of results since being taken private.

The UK’s third biggest coffee chain, bought for £225m in a management buyout led by its founder and chief executive in January, reported profits up by £2.3m at £9.6m.

Caffe Nero saw sales rise by 4% on a like-for-like basis in the year to May 31.

Air France-KLM and US airline Delta today unveiled plans for transatlantic flights out of Heathrow in a move set to rival British Airways.

The venture will see the two airlines join forces to share revenues and costs on routes linking major US cities and London’s Heathrow from next April.

The agreement takes advantage of the "open skies" deal signed between the European Union and the US to free-up historically highly restricted transatlantic routes, which comes into force in March next year.

The Air France-KLM and Delta pact will challenge the dominant market position at Heathrow currently held by BA and the Oneworld alliance, led by BA and American Airlines.

The pound at noon was US$2.0332 compared to US$2.0328 at the previous close while the euro at noon was £0.6969 compared to £0.6969 at the previous close.

Journalists

David Whetstone
Culture Editor
Graeme Whitfield
Business Editor
Mark Douglas
Newcastle United Editor
Stuart Rayner
Sports Writer