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NZ: News Analysis: Brewers see future in wine market

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New World winemakers are suddenly hot tickets with a number of big brewers looking for a stake in this lucrative market. Lion Nathan said earlier this week it would be buying another 5% of Montana, New Zealand's largest wine group, taking its share to nearly a quarter.Fosters is expected to snap up Corbans and rumours abound that Southcorp and BRL Hardy also have money to burn. Add the unknown intentions of the European and North American giants towards New World winemakers and owning shares in these companies is suddenly looking a good bet, after several rather dull years.DB Group put Corbans up for sale earlier this year and a number of the big Australasian players have made bids, including Fosters and Southcorp. Salomon Smith Barney is running the sale and the bidding period was expected to run until the end of this week. But the deal makers are understood to have flown from Sydney to Auckland on Monday and some analysts believe that Fosters, the hot tip to win Corbans, could close the deal within the next couple of days. The word in Sydney is that Southcorp, recognising it could not match Foster's big money offer for Corbans, decided to sniff around Montana. This is what prompted Lion Nathan's sudden decision to take another 5%of Montana.Lion Nathan CEO Gordon Cairns told just-drinks.com last month that he had no interest in expanding his wine operations so this week's decision is a sharp about turn in policy.Lion was forced to buy 19.9% of Montana in May when rumours of Foster's interest surfaced. Given these sudden forays into the market to protect its relationship with Montana some analysts have suggested that Lion is miscalculating its rival's intentions. But what is most surprising is that the big brewers have taken so long to consolidate their positions in the expanding wine market.David Robertson


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