AUSTRALIA: Analyst questions Southcorp takeover
The beverage analyst at Merrill Lynch has questioned the decision by Foster's to launch a takeover for fellow Australian Southcorp.
In a research note David Errington said the price Foster's was paying for Southcorp was "extremely high".
"We maintain our previously stated views that we don't believe Foster's buying Southcorp (particularly at this price) is in the best interests of Foster's shareholders - particularly over the coming two- to three-year period," Errington said.
"We do however acknowledge that Foster's is looking toward shareholder interests in the longer term (beyond five years) rather than medium term.
"Our concerns towards Foster's buying Southcorp (other than price paid) are underpinned by our view that the Australian wine market looks like it will deteriorate over the coming two- to three-year period, and that we believe there are material risks in integrating the Foster's and Southcorp wine businesses."
A revised assessment by Southcorp's independent expert has valued the company's shares closer to the bid value offered by Foster's Group....
Australian liquor giant Foster's bid for winemaker Southcorp is gathering momentum....
As one takeover story trundles on, another one has just moved up a gear....
The chief executive of Foster's believes the global premium wine industry is on the upturn....
Foster's Group Ltd is expected to announce that it is lifting its offer for fellow Australian Southcorp, transforming three months of corporate hostility into a friendly takeover....
Shares in Southcorp and Foster's have been halted from trading, pending an announcement....
Southcorp's share price has dropped below the offer price made by Foster's for the first time today (18 April)....
Foster's Group is considering upping its bid for Southcorp prior to extending its offer once again....
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