Nov. 15 (Bloomberg) -- Carlsberg A/S and Heineken NV raised their bid for Scottish & Newcastle Plc to 7.3 billion pounds ($14.9 billion), aiming to force talks as Britain's largest brewer rejected their approach for a second time.

Heineken, the biggest Dutch brewer, and Carlsberg, Denmark's largest, proposed a 750 pence-per-share cash offer to Scottish & Newcastle's board, 4 percent above last month's 720 pence bid. The U.K. maker of Foster's lager and Strongbow cider today said the bid ``substantially undervalues'' the company.

Carlsberg wants total control of the companies' Russian venture, while Heineken is after Scottish & Newcastle's British operations. Edinburgh-based S&N has started arbitration aimed at forcing Carlsberg to give up its stake in Baltic Beverages Holdings AB, which controls Russia's largest beermaker.

``We see rarity value in BBH,'' said Christopher Gower, an analyst at MF Global in London. ``This will drive the value higher. We feel that S&N is worth in excess of 800 pence.''

Brewers are merging to cut costs amid soaring prices for ingredients, electricity and metal for cans. SABMiller Plc, which declined to comment on speculation it may make a rival bid, fell in London trading today after saying it faces a tougher second half, partly because of rising grain prices.

Deals have accelerated after SABMiller and Molson Coors Brewing Co. last month agreed to merge U.S. units to win back drinkers from Anheuser-Busch Cos. and save $500 million a year.

Shares Climb

``This time we're going directly to the shareholders,'' Carlsberg spokesman Jens Peter Skaarup said in an interview. ``We want to give investors the information they need to put pressure on the board.''

Stock in Edinburgh-based Scottish & Newcastle gained as much as 8 percent and was up 19 pence, or 2.6 percent, at 759.5 pence at 3 p.m. in London, above the offer price.

The shares were worth 636.5 pence each on Oct. 16, the day before Carlsberg and Heineken announced their possible bid, and 570 pence at the start of 2007.

``The increase will make it more difficult for Scottish & Newcastle's management to continue its refusal to talk,'' said Marcel Hooijmaijers, an analyst at Landsbanki Kepler in Amsterdam.

Shares of Valby, Denmark-based Carlsberg, which has a 54 percent stake in the joint bid, rose 1 Danish krone to 649. Heineken shares slid the most in more than four years and were down 1.47 euros, or 3.2 percent, to 44.87 euros.

Russian Forecast

``Investors fear Heineken will pay too much,'' said Richard Withagen, an analyst at SNS Securities in Amsterdam. Analysts have said the terms of the deal mean the Dutch brewer may be subsidizing its Danish partner.

Carlsberg said it offered to cooperate with S&N to provide a profit forecast for BBH for the next two years, after the U.K. company said last week it wanted to provide more guidance for investors. Any forecast would be subject to the approval of BBH's board.

``We want all information about BBH to be available to the market so that shareholders can make up their own mind as to the value of Russia's most exciting beer business,'' said a Scottish & Newcastle spokesman who declined to be named. Forecasts for BBH's 2008 and 2009 earnings are of particular importance, he said. S&N will release a sales and strategy update on Nov. 20.

An ultimate bid price of 755 pence a share would equate to a multiple of about 11 times ebitda for Heineken, Alexandra Oldroyd, an analyst at Morgan Stanley in London, said in an Oct. 18 note.

`Save Face'

Carlsberg would pay about 13 times earnings, incurring a premium because of growth prospects in Russia, where demand is outpacing western European growth, she said.

``The consortium hopes that this increased offer will be enough to get sufficient access to carry out the analysis which would enable them to propose a bid high enough to both save the face of the S&N board and get an agreed bid approved,'' said Trevor Stirling, an analyst at Sanford C. Bernstein in London. He rates Scottish & Newcastle shares ``market-perform.''

The offer has prompted speculation Scottish & Newcastle will start talks with other beer companies to thwart the Carlsberg-Heineken approach. SABMiller Chief Financial Officer Malcolm Wyman today declined to say whether his company, the world's third-largest brewer, would make an offer.

London's Times newspaper said on Nov. 12 that Scottish & Newcastle was in talks to sell Elidis, its French distribution unit, for 200 million euros ($291 million), and a deal could be announced this week. The brewer has declined to comment.

Carlsberg today criticized such a potential sale as ``detrimental to the valuation of the French business'' and urged Scottish & Newcastle not to proceed.

Perceived credit quality worsened for both Scottish & Newcastle and Carlsberg. Credit-default swaps on Scottish & Newcastle rose 1 basis point to 53.5 basis points today, according to data compiled by CMA Datavision, with contracts on Carlsberg adding 4.5 basis points to 68 basis points. A basis point on a contract protecting $10 million of debt from default for five years is equivalent to $1,000 a year.

To contact the reporter on this story: Amy Wilson in London at awilson23@bloomberg.net.

Last Updated: November 15, 2007 10:07 EST