Foster's to buy Beringer for $1.5 billion

MELBOURNE, Australia – Foster's Brewing Group Ltd. agreed Monday to buy Beringer Wine Estates Holdings Inc. for about $1.5 billion in cash and debt, making it the world's most profitable wine

Tuesday, August 29th 2000, 12:00 am

By: News On 6


MELBOURNE, Australia – Foster's Brewing Group Ltd. agreed Monday to buy Beringer Wine Estates Holdings Inc. for about $1.5 billion in cash and debt, making it the world's most profitable wine company.


Australia's largest brewer said it would buy Beringer for $55.75 a share in cash, valuing the California wine maker at $1.15 billion. The offer represents a 24 percent premium to Beringer's closing price on Monday. The maker of Foster's Lager also said it would assume about $320 million of Beringer debt and raise as much as $800 million through debt and equity to pay for the transaction.


The acquisition, Foster's biggest ever, "gives it a good footprint in the U.S. and a reasonable distribution," said Don Hamson, investment director at Westpac Investment Management. "Beer is a low-growth area, so the expansion into wine is strategically a good move. The question still remains if they've paid the right price." Foster's said about 55 percent of Beringer's shareholders, including Fort Worth-based Texas Pacific Group, as well as Beringer's directors and senior managers accepted its offer. Foster's shares fell 5 cents to $4.40 Australian in trading Monday. The Class B shares of Beringer rose $1.56 to $45.06 in Nasdaq trading. The shares have climbed 13 percent this year.


Foster's said its shares will be suspended from trading Tuesday and resume Wednesday after it completes its equity offering.

logo

Get The Daily Update!

Be among the first to get breaking news, weather, and general news updates from News on 6 delivered right to your inbox!

More Like This

August 29th, 2000

September 29th, 2024

September 17th, 2024

July 4th, 2024

Top Headlines

December 13th, 2024

December 13th, 2024

December 13th, 2024

December 13th, 2024