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Scot.& Newcastle - Brand Distribution Agreement

RNS Number:1190P
Scottish & Newcastle PLC
21 July 2005

21 July 2005

                            SCOTTISH & NEWCASTLE PLC

Continuation of S&N strategy to focus on key brands by entering into a new
contractual arrangement with SABMiller in the UK.

Scottish & Newcastle plc (S&N) today announces that they have reached a new
contractual arrangement to cover the brewing, marketing, sales and distribution
of certain SABMiller plc brands in the UK. Under the terms of the contract, S&N
UK will continue to brew Miller Genuine Draft (MGD) and Miller Beer and will
retain its role in marketing and distributing the Miller Beer brand. SABMiller
will assume direct management control of Miller Genuine Draft and Peroni Nastro

As a consequence of the new contractual arrangements, S&N UK will have the
opportunity to further develop the Miller Beer brand, particularly in Scotland.
SABMiller will set up a stand-alone organisation to sell, distribute and market
Miller Genuine Draft and Peroni Nastro Azzurro in the UK.

The deal will be modestly earnings enhancing and strategically significant as it
further consolidates the S&N UK business around the four key drive brands of
Foster's, Kronenbourg 1664, John Smith's and Strongbow. This is a further move,
in addition to the Beck's transfer announced on 27 May 2005, by S&N UK to follow
its stated strategy to focus on these key brands which grew sales volumes by
4.5% in 2004 and are the key drivers of growth.

This new agreement will take effect on 30th January 2006.

Notes to editors:

   * S&N UK has been exclusive distributor of MGD since 1997. It has
     distributed Peroni Nastro Azzurro in the UK off trade since 2000.
   * MGD represented c.1.3% of S&N UK 2004 beer and cider volumes, with
     Peroni Nastro Azzurro representing c. 0.3%.
   * S&N UK is the market leader with a 27% market share in 2004, UK
     operating profit increased by 11.4% to £176million and S&N UK's beer and
     cider volumes were up by 1.0%, ahead of the UK beer and cider market at
   * S&N UK increased A&P investment by 20% in 2004.
   * The arrangement for the brewing, sales, marketing and distribution of
     the SABMiller brands in the Republic of Ireland and in Northern Ireland
     will remain unchanged by this announcement.

Enquiries to:
Nadja Schaufele (Investors)     +44 (0)131 528 2000
Linda Bain (Media)              +44 (0)131 528 2000

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