Foster's Group on Tuesday rejected a A$9.5 billion ($10.1 billion) cash takeover offer from global giant SABMiller as too low, even as investors said that Australia's largest brewer would succumb to a slightly higher offer.
Foster's has high margins and a 50% market share in Australia, where it brews the Victoria Bitter and Pure Blonde brands.
News of the bid sent Foster's shares surging 14% to A$5.16, a nine-month high and above SABMiller's offer price of A$4.90 per share.
SABMiller, which makes Peroni, Grolsch and Miller Lite, has long been seen as the favourite to take over Foster's, since rivals such as Heineken are struggling with debt piles or lack adequate funding.
The offer was at a premium of 8.2% to Monday's close.