We are a week away from Foster's Group's full-year results announcement, and things appear to be hotting up in the takeover saga with SABMiller.

Foster's' share price has dropped to within view of SABMiller's AUD4.9 (US$5.1) per share cash offer. At the end of today's trading, it stood at AUD5. Last week, it sank as low as AUD4.51 amid the global stock market disarray.

There is speculation that SABMiller is preparing to raise its bid, albeit only slightly. For almost two months, the Peroni brewer has been content to let Foster's stew. However, with the share price looking rocky and Foster's likely to report a tough year of trading on 23 August, could the time to pounce be approaching?

Although Australia's beer market remains lacklustre, SABMiller has experience of pulling value out of a mature beer market: Over the past three years, it has achieved US$711m in synergies at MillerCoors in the US. Foster's is already highly profitable, but SABMiller's management still insists that it sees opportunities to run the business more efficiently.

That said, most analysts believe that the margin for error on Foster's is low. In other words, SABMiller cannot afford to splash too much more cash if it wants a decent return on its investment.

Features-wise last week, we turned our microscope on to Anheuser-Busch InBev after it posted its H1 figures last week.

Chris Mercer also took a thorough swing by the rum wars bubbling along between Puerto Rico and the US Virgin Islands, and the parts played therein by the likes of Diageo and Bacardi. Michelle Russell, meanwhile, pondered the future for the bottled water giants of Danone and Nestle.

Until next time...

Olly Wehring
Managing Editor
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