SABMiller will take its $10 billion bid for Foster’s Group directly to shareholders, going hostile after the board rejected the price as too low.
The board of Melbourne-based Foster’s has shown “no willingness to engage,” SABMiller said, after it announced an initial offer on June 21. Foster’s had said the bid “significantly undervalues” Australia’s largest brewer.
An acquisition of Foster’s would be SABMiller’s biggest and would give them about half of Australia’s beer market. Chief Executive Officer Graham Mackay has made more than two dozen acquisitions since he moved SABMiller’s listing to London in 1999, though he’s passed on some of the industry’s biggest deals since 2008.
SABMiller, which started selling beer to gold prospectors in South Africa in 1895, has expanded through acquisitions including Colombian brewer Bavaria and the Grolsch brand. The company became the second-biggest brewer, behind Budweiser maker Anheuser-Busch InBe, after the $5.6 billion takeover of Miller Brewing Co. by South African Breweries Plc in 2002.