foster's: raised glasses or raised voices?

Foster's: Raised glasses or raised voices?

October 21, 2009 - 6:47AM
By Jamie Freed and Danny John


There should be no shortage of topics to discuss at Foster’s Group’s annual meeting in Brisbane today.

Not only is the company facing a huge grape glut that has hurt its wine business, there are now headwinds from the rising Australian dollar.


A broom has been swept through most of the company’s management over the past year under the direction of chief executive Ian Johnston, so investors will be interested to hear some ideas from the new wine and beer management teams.

Shareholders would also be interested in any update on a potential de-merger of the wine and beer business. Many analysts think such a move is unlikely until next year at the earliest, but the market thinks it is likely to be done eventually.


Afterward, there is an expectation that international brewers and the SABMiller/Coca-Cola Amatil beer joint venture could be interested in making a bid for the more stable beer arm. MolsonCoors last year bought just under 5 per cent of Foster’s, but the market thinks that is more likely to be meant as a seat at the bargaining table in the event of a de-merger rather than a precursor for its own bid.

Other topics of interest at the annual meeting could include potential changes to the taxing regime on wine, an update on some vineyard asset sales and commentary surrounding the continued effects of the higher taxes on alcopops.

http://www.smh.com.au/business/fosters-raised-glasses-or-raised-voices-20091021-h77l.html