Hong Kong, China (CNN) – Foster’s iconic slogan “Australian for beer” may soon be plastered over with one in Chinese, Japanese or Spanish. SABMiller’s unsolicited attempt to buyout Australia’s number one brewer underscored its $10 billion offering as an undervaluation. And that’s knocked the beer goggles off other competitors. They’re now sidling up to the bar to see if Foster’s is the cool refreshing beverage that could sweeten their portfolio too. But can you imagine a Foster’s owned by China’s Qingdao, Japan’s Asahi or Mexico’s Grupo Modelo, which makes Corona? It’s possible, but SABMiller says hold on. The world’s number two brewer says it’s still in pursuit and the party’s just begun.
SABMiller CEO Graham Mackay extolled the virtues of Foster’s stability, presence and popularity on the company website. “Foster's represents an attractive opportunity for SABMiller to acquire a leading brewer in a stable profitable beer market. Foster's is the Australian beer market leader, with a national footprint across all states and has a well-developed route to market. Its portfolio contains seven of the top 10 Australian beer brands.” But after Tuesday’s failed try for Foster’s, Mackay will have to offer even more to get Australian attention. News of the offer fizzed up Foster’s stock, which saw its biggest one-day gain in more than 17 years. By Tuesday’s close, its share price had popped 13.47%. In comparison, SABMiller’s offer of $10 billion was just an 8.2% premium relative to Monday’s close. Funny that in just 24 hours a pint of lager could get that much more expensive. And evidence of Foster’s confidence came to a head through its reaction statement, curtly titled “Approach Rejected”: “Foster’s Group Limited (Foster’s) announces that it has received an unsolicited, incomplete, non-binding and conditional proposal from SABMiller plc to acquire all of the shares in Foster’s via a scheme of arrangement at a price of $4.90 per share in cash. The Board of Foster’s believes that the proposal significantly undervalues the company.” And with that, the lights came on and SABMiller found itself the “last guy in the bar”. But Tuesday’s first round will likely be one of many more. Analysts believe SABMiller will be back again with a bit more cash in its pockets if it’s serious. At the same time, other companies have just now realized they might be thirstier for their own takeover than they realized.
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updated 1101 GMT, May 22
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Just as long as they keep Fosters beer out of Australia. That is the worst beer in the world, they are all welcome to it!!!
As an Australian, I am happy to report that no one drinks this swill here. In fact, I've never even seen it in store available for purchase. It is export only quality.
Fosters, Australian for rejection.
The Chinese were given the key to the door of world trade when Reagan gave them a free trade agreement. They have taken full advantage of that and are now the manufacturing powerhouse of the world. Nice one USA.. Do you have any plans to redress this situation or are you going to be nice and just roll over.
Fosters...Australian for 'roo piss.
I live in Australia and i don't know anyone who drinks Fosters, lol.
Urgh. They can have it... Australians don't drink Foster's anyway – its bloody awful.
I would never spend £3 on a pint of this watered down rubbish!
When ever I am fortunate enough to travel to Australia, Fosters is the last beer I would reach for. It would be right at home with the absolutely terrible tasting Miller. Spend less on adverts, and more on making a good beer you wankers!!!!
Do you drink VB, Carlton Draught, Pure Blonde, Cascade, Fat Yak, Beez Neez etc???? This is 99% of volume and profit which is up for sale... Fosters does not even own the Fosters brand in most major export markets – USA, India & UK
Keep our Aussie iconic beer brands Australian owned!!
OK, so now that we know that Foster's has been serving up liquid propaganda, what are considered great Austrailain beers in Australia? :)
it's funny, but every Australian I've ever met has, without exception, echoed the sentiment I'm reading here...
happily, as a Coloradan, I can tell you that while Coors isn't anything to write home about (and while we're on the subject, doesn't compare to any of our numerous micro-brews) it's not so bad that I'd disown it.
I'm glad I'm not the only one to have banned Fosters from my table. The first time I drank one, I had to double check to confirm that the large can was not indeed a motor oil can.
We can make our own thanks.....there are tons of beer brewers in China, maybe they should make wine instead?
Peter is right, Foster's beer portfolio includes VB, Cascade, Crown Lager as well as Pure Blonde
Carlton Draught and Melbourne Bitter. If you like ANY Australian beer, foreign ownership is never good....
Ruben............ here are just a few quility Australian beers
Cascade Premium, Boags Draught, Tooheys New, James Squire (entire range) XXXX midstrength (well I like it), Cooper's Stout, Beez Nees....I could go on....VB ain't too bad. Most all in country beers are better than most American beers, sorry :)
American micro brew, that's where it's at!
Best beer in the world is 'Toohey's extra dry'platinum. It is an Aussie beer streets ahead of anything else on the market
I'm a Wisconsinite, and I don't drink Miller anymore. Gimme a Schlitz, Spotted Cow or a Leine's any day! We're lucky to have awesome microbreweries here as well.
I would like to thank for the efforts you have put in writing this blog. I am hoping the same high-grade blog post from you in the future as well.
Thanks
Melissa Wilson
"Private equity Bahamas"