SABMiller says not to bid for Scottish & Newcastle

LONDON (Reuters) - Global brewer SABMiller Plc said it had decided against a bid for British rival Scottish & Newcastle Plc, whose shares had climbed earlier on Wednesday on market talk of a rival takeover.

SABMiller said in a statement that in line with its normal practice of evaluating all strategic opportunities "it undertook a preliminary evaluation of the Scottish & Newcastle Plc Group but decided not to take further action".

S&N has already agreed a takeover from Carlsberg and Heineken.

Earlier, market talk of a rival bid at 850 pence a S&N share, worth 8.3 billion pounds ($16.2 billion), caused the Edinburgh-based brewer's shares to rise to a high of 811-1/2 pence before closing up 2.5 percent at 807-1/2.

A spokesman for S&N declined to comment.

Analysts had said there would be difficulties for a bid by SABMiller on competition grounds, while SABMiller would not get full control of Russia-based Baltic Beverages Holding (BBH) which is 50-50 owned by S&N and Carlsberg.

Last month, Carlsberg and Heineken agreed a joint 800p cash breakup bid for S&N valuing the brewer of Foster's and Kronenbourg at 7.8 billion pounds.

Analysts had said a SABMiller bid could raise competition problems in India and Russia, and also upset SABMiller's relations with Molson Coors, where the two are intending to set up a joint venture in the United States.

S&N and Molson Coors are major competitors in the British beer market.