Last week SABMiller made Foster's shareholders a cash offer
of $10bn. The Foster's board rejected it, the second bid that SABMiller had
made for the company.
Rob Forsyth, head of industrials at Investec Asset
Management, said Foster's was not a critical acquisition for SABMiller.
"From a financial point of view the takeover makes a
lot of sense for SABMiller. From a strategic point of view it is less
important."
Forsyth said that, in contrast, the offer represents a good
opportunity for Foster's.
"The business has been struggling for a while and is
losing market share in Australia - not only against imported beer, but also
against other products such as spirits and wine.
"Some of the trends contributing to the decline in
market share will make it difficult for Foster's to turn around on its
own."
An expert close to SABMiller said the group also believes it
can inject new life into the Foster's brand.
"It would also be a strategic move for SABMiller to
move into an established market," said the expert, who did not wish to be
named.
SABMiller has recently expanded rapidly thanks largely to
large moves in developing markets.
This week analysts were somewhat surprised by SABMiller's
offer because the Foster's full-year results will be announced only this coming
Tuesday. The expectation is that these results will not be very good - which is
something exerting further pressure on the Australian company's board.
Last week the board issued a statement dissuading its
shareholders from even considering SABMiller's offer.
However, the third-largest shareholder in Foster's, Perpetual Investments, has welcomed the latest SABMiller approach, according to Bloomberg.
- Sake24
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