AUSTRALIAN brewer Foster’s Group said it will go ahead with plans to split up its beer and wine businesses yesterday, as it revealed lower-than-expected half-year profit.
Foster’s said yesterday that the split should be completed in May, in a move that could attract suitors for its A$10bn (£6.3bn) beer operations.
The wine business will be separately listed on the Australian Stock Exchange, the firm confirmed, with shareholders getting one Treasury Wine Estates (TWE) share for every three shares in Foster’s.
Rumours swept the City last September of a private equity feeding frenzy after Foster’s confirmed it had turned down a bid of between A$2.3bn and $2.7bn for TWE.
Foster’s said yesterday a spin-off listing was the best way to make TWE more flexible while saving on operating costs, but analysts said the leaner divisions could attract takeover interest once the outlook for beer and wine sales have stabilised.
Foster’s said a subdued beer market dented its first-half profit, which fell 12.3 per cent to A$312.1m.
The firm’s wine division made A$94.7m in underlying profit, 17 per cent down on the same period last year.