Blog: Foster's Millions
Chris Brook-Carter | 18 August 2003
Everyone but Foster's seems to be voicing an opinion and if the company's boss Ted Kunkel is following the press he will have been bombarded now by countless whys, wheres and hows.
The primary division in opinion though is whether to expand his wine empire or not. If not then the options reduce significantly and we may see the company invest in a share buyback, debt reduction or capital return to shareholders.
But frankly that all seems a bit dull. Quite apart from the selfish reasoning that debt reduction just doesn't make good editorial, I can't get my head round the idea that a company of Foster's international scale and ambition would go to all the trouble of selling off such a significant part of its business not to build a war chest for acquisitions.
And neither does the idea that wine does not represent a good investment cut much sway for me. Certainly the industry is under more pressure now than at any time in the last decade, but its long term potential still remains real. Wine is a long term business - a notion lost on investors and analysts all too often - prone to short term fluctuations in fortune. But I can't imagine too many of BRL Hardy's initial investors complaining about the ROI prospects of a well run wine business.
So just to add to the stream of predictions, my money is sitting on a US wine acquisition, perhaps Brown-Forman's wine division or Kendall-Jackson. The other option is Southcorp, but the Oatley family involvement makes any deal more complicate than either of the above, while the domestic market holds none of the potential of the US.
Today is SABMiller's final day. Some time this evening, Brussel's time, the second-biggest brewer in the world will be subsumed into the biggest, creating a beer behemoth of unprecedented proportions....
No, this is not PepsiCo's new ad slogan for its Mountain Dew brand....
Major wine players flocked to China ready for online giant Alibaba's 9.9 Global Wine and Spirits Festival, which took place on 9 September....
In May, Heineken's CEO, Jean-François van Boxmeer, called Vietnam the "poster child" for international beer thanks to strong demographics and growing demand....
- Five ways small brands can beat big players
- Pernod Ricard Q1 2017 results by region, brand
- Interview, Bulldog Gin CEO Anshuman Vohra, Pt II
- Interview, Bulldog Gin founder Anshuman Vohra
- The end is nigh for Global Travel Retail - Comment
- Stumbling UK Pound prompts Conviviality price hike
- Edrington’s The Macallan 40 Year Old - NPD
- Bacardi rolls out new Oakheart rum packs to US
- Seedlip eyes global growth with export deal
- Beam Suntory workers end Jim Beam strike
- Global gin insights - market forecasts, product innovation and consumer trends
- Global Scotch whisky insights - market forecasts, product innovation and consumer trends
- Global rum insights - market forecasts, product innovation and consumer trends
- Global Wine Market 2016-2020
- Global RTD insights - market forecasts, product innovation and consumer trends