JD Wetherspoon pulls Heineken products from UK pubs

JD Wetherspoon has ended its deal with Heineken over pricing in Ireland.

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By :  ,  Financial Analyst

JD Wetherspoon has pulled all Heineken products from its 926 UK pubs following a pricing dispute with the Dutch brewer.

Heineken, which owns brands such as Foster's lager, John Smith's bitter and Strongbow cider as well as Murphy's stout, receives £60 million from the pub chain for UK sales every year. However, Wetherspoon has fallen out with the brewer about the supply of beer to one pub in the Republic of Ireland.

The row erupted over the opening of a new Wetherspoon outlet in Dun Laoghaire. Wetherspoon stated that Heineken had requested that the pub chain's chief executive John Hutson gave personal guarantees that all of its bills would be paid if Wetherspoon did not pay them.

Wetherspoon added that Heineken had refused to supply its lager, which is the biggest-selling draught beer in Ireland, along with Murphy's from its second pub in the country. This led to the company pulling Heineken and Murphy's from all of its UK pubs. It had previously been selling the two beverages at prices 40 per cent below the competition at its first Irish pub in Blackrock, Dublin.

Tim Martin, Wetherspoon chairman, spoke of the long-standing relationship with Heineken, adding: "We have been trading with Heineken for 35 years and they have never requested personal guarantees before.

"The refusal to supply Heineken lager and Murphy's just before the opening of our new pub in Dun Laoghaire, which represents an investment by us of nearly four million euros, is unacceptable and hard to understand."

Heineken UK declined to comment on the situation in detail but explained that it was "seeking a resolution as soon as possible".

Wetherspoon is one of the fastest-growing pub chains in the UK and has now set its sights on expanding across the Irish Sea to Ireland. In March, the company announced a 3.2 per cent boost in pre-tax profits to £36 million continuing its strong performance throughout the year.

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