BackSABMiller agrees to buy Foster’s for $10.2 bn
SABMiller agrees to buy Foster’s for $10.2 bn
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London: Brewing giant SABMiller Plc agreed to buy Foster’s Group for an increased price of A$5.10 a share valuing the Australian beer maker at A$9.9 billion ($10.2 billion) and putting SABMiller at the head of Australia’s beer market.
As part of the deal announced on Wednesday, Foster’s will also return A$0.30 a share as well as a final dividend for year to 30 June 2011. The total value of the deal, including debt, is A$11.5 billion.
“We are pleased that we reached agreement on a recommended transaction to be put to Foster’s shareholders," said SABMiller chief executive officer (CEO) Graham Mackay in a statement
The London-based brewer of Peroni, Miller Lite and Grolsch launched its initial cash bid worth A$9.5 billion, or A$4.90 a share, on 21 June and then went hostile by taking the offer direct to shareholders at the same price on 17 August, but Foster’s rejected both approaches as being too low.
SABMiller says the bid is part of its strategy of creating an attractive global spread of businesses to add to its operations largely in the emerging markets of Africa, Latin America, Asia and Eastern Europe.
It has been long seen as the favorite to take over Foster’s with other big brewing rivals saddled by high debts after recent deals. Fosters’ is seen as attractive due to its high profit margins and dominant position in Australia although beer volumes have sagged recently with a poor summer and a consumer downturn.
The Foster’s business which SABMiller is buying holds about half of Australia’s beer market and little else, having retreated home from the global beer empire it once held and having split off its wine business earlier this year.
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