Foster's rejects takeover proposal
Source: Agencies |
June 22, 2011, Wednesday
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Print Edition
Print Edition
AUSTRALIA'S biggest brewer Foster's Group Ltd said yesterday it has rejected a US$10 billion cash takeover offer from beer maker SABMiller PLC as too low.
Foster's announcement came after beverages group Coca-Cola Amatil Ltd amended the terms of a brewing joint venture with SABMiller, which enabled SABMiller to make its A$9.5 billion (US$10 billion) bid.
London-based SABMiller, the world's second biggest brewer by volume, is offering A$4.90 a share in cash for Foster's - an 8 percent premium on Foster's share price before the offer.
"The board of Foster's believes that the proposal significantly undervalues the company," Melbourne-based Foster's said.
After the statement, Foster's shares jumped 13 percent on the Australian stock market to A$5.12, its highest price since February 2007.
SABMiller said Foster's was attractive because it was Australia's leading brewer with seven of the top 10 beer brands, and buying the company was consistent with its global strategy.
Australia is an attractive market because of its population growth and economic connections to Asia, London-based SABMiller said.
SABMiller said it had a proven track record of integrating brewing companies and improving the performance of those businesses.
"We continue to believe that the proposal price is attractive and offers good value to Foster's shareholders," SABMiller chief executive Graham Mackay.
There has been much speculation Foster's would become a takeover target after it put its wine businesses into a separately listed company.
Foster's announcement came after beverages group Coca-Cola Amatil Ltd amended the terms of a brewing joint venture with SABMiller, which enabled SABMiller to make its A$9.5 billion (US$10 billion) bid.
London-based SABMiller, the world's second biggest brewer by volume, is offering A$4.90 a share in cash for Foster's - an 8 percent premium on Foster's share price before the offer.
"The board of Foster's believes that the proposal significantly undervalues the company," Melbourne-based Foster's said.
After the statement, Foster's shares jumped 13 percent on the Australian stock market to A$5.12, its highest price since February 2007.
SABMiller said Foster's was attractive because it was Australia's leading brewer with seven of the top 10 beer brands, and buying the company was consistent with its global strategy.
Australia is an attractive market because of its population growth and economic connections to Asia, London-based SABMiller said.
SABMiller said it had a proven track record of integrating brewing companies and improving the performance of those businesses.
"We continue to believe that the proposal price is attractive and offers good value to Foster's shareholders," SABMiller chief executive Graham Mackay.
There has been much speculation Foster's would become a takeover target after it put its wine businesses into a separately listed company.
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