Modelo, Molson mull Foster’s bid
Molson Coors Brewing Co and Mexico’s Grupo Modelo are exploring a joint bid for Australia’s Foster's Group Ltd , a source said, amid talks that further suitors may emerge for the maker of VB and Cascade beer.business Updated: Jun 04, 2011 01:19 IST
Molson Coors Brewing Co and Mexico’s Grupo Modelo are exploring a joint bid for Australia’s Foster's Group Ltd , a source said, amid talks that further suitors may emerge for the maker of VB and Cascade beer.
Speculation of a possible takeover pushed Foster’s shares up more than 7% early on Friday, lifting the value of Australia’s largest brewer to A$8.9 billion ($9.5 billion). The stock pulled back in afternoon trade to close 3.5% higher after Foster’s said it was not aware of any reason for the gains.
Foster’s has been the subject of takeover talk since it announced plans last year to spin-off its struggling wine operations, which was seen as a deterrent to potential suitors.
Since then, potential buyers such as world number two brewer SABMiller have been seen as the most likely to bid, according to banking sources.
A successful bid for the company would be the biggest deal in the beverage sector globally and the largest inbound Australian takeover this year.
“It is 100% likely that they (Molson and Modelo) have been contemplating that kind of thing, but only in the sense that any major global brewer is always looking at potential targets,” said Angus Gluskie, portfolio manager at White Funds Management, which holds Foster's shares.
Bank of America and Deutsche Bank are helping Molson, which makes Coors Light beer, and Modelo, the maker of Corona beer, come up with financing for a possible offer for Foster’s, sources said.
First Published: Jun 04, 2011 00:42 IST