Fosters had rejected SAB’s previous bid worth A$9.5bn, saying it undervalued the company.
That triggered a hostile bid from SAB, which approached the company’s shareholders directly in an effort to close a deal.
However, the Foster’s board said it would be recommending the latest offer to its shareholders, who will now vote on the offer.
SAB said the deal would give it access to Australia’s “strong economic growth prospects”, as well as the country’s “stable and profitable” beer industry.
“We look forward to working with Foster’s employees and other stakeholders to ensure the success of Foster’s in the future as the largest brewer in Australia with an outstanding portfolio of brands,” said SAB’s chief executive Graham Mackay.
The offer values Foster’s shares at A$5.10, compared with the original offer of A$4.90 a share made in June.
There have been talks of a takeover of Foster’s since it announced plans to break itself in two last year.
The brewer span off its troubled wine business as the company feared it was putting off would-be suitors. Any purchase of Foster’s by SAB will not include the Foster’s lager brand in the UK and Europe, where it is owned by Heineken.