AUS: Foster's Group board sticks to its guns on SABMiller bid
Foster's Group tells shareholders not to respond to SABMiller
Foster's said today (18 August) that it will recommend its shareholders to reject SABMiller's proposed "highly conditional offer". Yesterday, SABMiller said that it would approach Foster's shareholders directly with a takeover bid priced at the same level as the one it put to Foster's board almost two months ago.
"The board of Foster's reiterates its belief that an offer price of AUD4.9 per share significantly undervalues the company in the context of a change of control," said Foster's. "In addition, the high level of conditionality further detracts from the proposed offer."
SABMiller's decision to go hostile in its pursuit of Foster's is likely motivated by several factors, including the intransigence of Foster's' board over the past two months and fresh fragility in Foster's' share price. The timing of SABMiller's announcement, meanwhile, looks designed to probe for cracks between Foster's shareholders and management ahead of the Australian brewer's full-year results.
"Foster's shareholders are advised to take no action and ignore all documents and communications from SABMiller in relation to its proposed offer," the board of Foster's said today. So far, no other bidders have come forward to rival SABMiller.
Foster's shares stood at AUD5 at the end of today's trading on the Australian Stock Exchange, up 0.8% on the previous day.
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