British brewer Scottish & Newcastle has rejected a 6.8 billion-pound ($14 billion) bid proposal from Denmark's Carlsberg and Dutch peer Heineken, it said on Thursday.
The 720 pence per share cash proposal is below Scottish & Newcastle's (S&N) current share price, which spiked last week on news that Carlsberg and Heineken were planning a bid, and well short of the 800 pence which some analysts believe will be needed to win a recommendation from S&N's board.
"The board, having consulted its advisers, has no hesitation in rejecting this proposal as it substantially undervalues the unique strengths and market positions of S&N," S&N said in a statement.
Some analysts said the proposal looked like an opening shot.
"I think Carlsberg and Heineken can afford to raise the bid above this level and still make it worth their while," said Jyske Bank analyst Jens Thomsen.
Shares in S&N, Britain's last big independent brewer and number six in the world, were down 0.4 percent. Carlsberg shares were up 1.4 percent at 684.5 Danish crowns. Heineken shares were up 1.5 percent at 47.25 euros.
Carlsberg and Heineken said last week they planned a joint cash bid for S&N, but gave no price, to split up the spoils of the Edinburgh-based brewer.
Carlsberg intends to acquire S&N's interest in Russia-based brewer Baltic Beverages Holding (BBH), France and Greece, while the world's fourth-largest brewer, Heineken, would take control of S&N's business in the UK and other European markets.
Carlsberg declined to comment on the statement.