Bitter beer war splits brewery

The future of the Tomos Watkins pints is up for grabs

The internal war brewing at Wales's fastest growing beer chain Tomos Watkin has stepped up as shareholders refuse to put the firm into liquidation.

The board of directors, in turn, refused to comply with shareholders demands that they resign.

The row centres around the sale of the company's chain of pubs.

We wish to understand what is happening to the company

Shareholders' spokesman

Shareholders have now vowed to take legal action against the board to wrestle back control of the pubs, which have been sold to Celtic Inns.

Tomos Watkin was resurrected in 1995 after a century and brews several traditional, distinctively branded Welsh ales.

It began life as a microbrewery in Llandeilo, Carmarthenshire, and later opened a large brewing facility at Swansea as part of a planned £10m, three-year investment to create 150 more jobs.

Sale disagreement

The company has found success with ales such as Cwrw Haf (Summer Ale) and Merlin's Double Stout has made in-roads on SA Brain's successful bitter sales, and has signed deals to be sold at some English pubs.

It had Welsh pubs including Cardiff's Cayo Arms - named after controversial 1960s Free Wales Army Julian Cayo - the Castell Inn in Llandeilo and the Harry Watkin in Llanelli, south west Wales.

Founder Simon Buckley left the company in March, over disagreements connected with the sale of the pubs last autumn.

Simon Buckley founded the company in Llandeilo

Meanwhile, Tomos Watkin's brewing division was bought by Hurn's Beer Co, its own free-trade distributor.

There were claims that Mr Buckley was ousted over disagreements about the company's direction.

He was said to have objected to plans to bankroll the acquisition of a rival pub chain with help from venture capitalists.

Mr Buckley, whose family formed the Buckley brewery in Llanelli before it was sold to SA Brain in the 1990s, is incensed.

At an Extraordinary General Meeting in Swansea on Thursday, shareholders holding 66% of the firm demanded the resignation of the new board, which now wants to liquidate Tomos Watkin.

Leading the rogue shareholders, Clive Scourfield said he wants to appoint a new board and claims the sale of the chain is invalid without the signatures of 75% of the owners.

Court threat

An earlier statement issued by stakeholders read: "It would appear that key assets owned by Tomos Watkin have been sold to companies without reference to shareholders.

"Shareholders have not received any communication from the board and have not been able to contact any one at the company.

"At this stage we wish to understand what is happening to the company and what has happened to precipitate a sell-off of the company's assets."

After hearing the board's refusal to quit, shareholders said they intend to cite Section 320 of the Companies Act (1985) to nullify the sale.

The row is now set to go to court to be resolved.

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In an earlier version of this report, we stated incorrectly that Celtic Inns was chaired by Welsh businessman Sir Terry Matthews. We are glad to correct this report to note no connection between the parties, and we apologise for any inconvenience caused to Sir Terry Matthews.