SABMiller goes hostile with $10 b Foster's bid

The cash offer at $A4.90 a Foster’s share was similar to SABMiller's first approach back in June, though the London-based brewer said the offer would be reduced by any dividend paid by Foster’s in the future, with analysts forecasting a 15 cent second half dividend to be announced next week.

Foster’s third-largest shareholder saw SABMiller’s move on Wednesday, as a way to get the ball rolling on a deal after Foster’s refused talks, and was not surprised SABMiller came back at A$4.90 since that was the price it initially proposed.

SABMiller has unsuccessfully tried to engage with Foster’s without any luck over the last two months, and its preferred route is still to go for a recommended bid, analysts said. Under Australian stock market rules, it now has two months to submit a formal bid.

Foster’s immediately rejected SABMiller’s offer in June, and CEO John Pollaers said the offer was so low it was not worth discussing. He recently came under fire from some shareholders for failing to engage with SABMiller.

SABMiller has its financing in place and is ready to go ahead with its bid and not wait for Foster's annual results on August 23, which are expected to show a decline in beer profits.

A deal would join together the brewer of Miller Lite, Peroni and Grolsch with the Melbourne-based maker of Victoria Bitter, Pure Blonde and Cascade beer, and would be the biggest brewing deal since InBev paid $52 billion to buy Anheuser-Busch to form AB InBev in the world's biggest cash takeover in 2008.

DH Newsletter Privacy Policy Get the top news in your inbox
GET IT
Comments (+)