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S&N to cut jobs, sell pubs
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January 17, 2001: 5:51 a.m. ET
U.K.'s biggest brewer to slash 1,300 jobs; sell or transfer 940 pubs
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LONDON (CNNfn) - U.K. brewer and pub firm Scottish & Newcastle said Wednesday it will dispose of 920 pubs and cut 1,300 jobs at its brewing unit.
Britain's leading brewer said it would sell 740 of its 2,373 managed pubs in its Scottish & Newcastle Retail business and transfer 180 to leased outlets in an effort to secure future earnings growth.
 Scottish Courage will reduce its brewing unit workforce to 5,200 from 6,500 as part of the cost-cutting reorganization.
The job cuts will initially cost the firm £116 million, which will be written off as exceptional items, but will eventually save Scottish & Newcastle £46 million annually, the company said.
Pubs in Britain tend to be managed directly by breweries, or leased to tenants who guarantee to buy a certain amount of beer from the brewery.
"The widely reported pressures in the pub market have not altered the strong growth potential of good retail assets nor do they invalidate the value of an outstanding shop window for both existing and new beer brands," Brian Stewart, chairman of Scottish & Newcastle, said in a statement.
Scottish & Newcastle, whose beer brands include Courage, John Smith's and Kronenbourg, accounts for about 29 percent of the U.K. beer market.
Revenue at the pubs to be sold or transferred totaled £331 million in the financial year through November 2000, generating a profit of £47 million. The firm said it had already been approached by potential buyers and was looking to sell its properties to a financial institution.
Buyers such as Japanese brokerage Nomura have become major pub owners in Britain in recent years. They buy pub estates and use the cash flow from the business to pay off the debt incurred in the purchase.
Scottish & Newcastle (SCTN) shares were down 3.25 pence, or 0.7 percent, at 458 pence in early London trade. 
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Scottish & Newcastle
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