AUSTRALIA: Foster's eyes Europe for acquisitions

By just-drinks.com editorial team | 1 October 2002

Australian beer and wine giant Foster's Group has indicated that it is looking towards Europe for bolt-on acquisitions.

Whilst attending the Merrill Lynch Australasia Investment Conference, Foster's Beringer Blass Wine Estates managing director Walter Klenz is quoted as saying that while the company already had distribution strength in the United States and Australia, it was looking for more scale in Europe.

Klenz added that Foster's did not need to pay high levels for bolt-on acquisitions, considered to be up to around A$100 million ($54 million).

"We don't necessarily have a gaping portfolio gap," he said. "We think we really have a very sustainable product portfolio right now."

Foster's has US$400m of convertible bonds which are due to convert to equity in October next year at a price of US$2.85. CEO Ted Kunkel said the funds from these bonds could be used for a share buy back or acquisitions.

However he also made clear that the company's assessment of purchases that provided shareholder value was not linked to the bond conversion.

Companies: Foster’s