SABMiller buys Foster’s for $9.9 billion

SABMiller has bought Foster’s following a three month process of opposition and denials from Australia’s largest brewer that needed help.

Just last week the company chairman urged shareholders to reject the London-based company’s bid.

SABMiller’s chief executive Graham Mackay did not even set foot in Australia before making the purchase.

Instead, Mackay and Fosters Group Chairman David Crawford did the deal at a conference in Istanbul last week, Bloomberg reports.

Crawford has been rejecting the takeover since June, saying SABMiller’s offer of $4.90 per share undervalued the company.

Despite the lowest sales profits in two decades, Fosters said at the time it remained optimistic about the future.

The offer Foster’s agreed to yesterday was $5.10 per share, a total value of almost $10 billion and SABMiller’s largest ever acquisition.

It intends to increase its earnings per share in the first year.

While the process was lengthy and complicated, SABMiller remained confident an agreement could be reached.

"A couple of weeks ago, it became obvious our positions weren’t irreconcilably far apart," Mackay said in an interview with Bloomberg Television.

"We’ve thought for awhile that this was an attractive deal at the right price."

Foster’s has not commented on the negotiations, but SABMiller’s Graham Mackay told the ABC’s AM program the takeover came at the right time.

"It was essentially to be able to take advantage of all of the opportunities we saw coming up with the fall of communism, the privatisation of any state run economy, state run businesses and that strategy proved spectacularly successful," he said.

"So we got in early and we established very strong positions and as we did that, we were able to refine our skill set, develop new skills to cope with very different markets that we encountered around the world."


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