SABMiller PLC, one of the world's largest brewers, has launched a hostile $10 billion bid Wednesday for Australian rival Foster's Group Ltd. after its board rejected a takeover offer.
The maker of Peroni, Grolsch and Miller Lite said it is taking the 4.90 Australian dollars ($5.13) per share cash offer, minus any dividend Foster's chooses to pay out, straight to shareholders and that the offer would be funded by existing resources and new debt.
The London-headquartered company said Foster's had so far declined to consider a similar offer made in June. The Australian brewer said the bid significantly undervalued the company.
SABMiller had said in June that Foster's was attractive because it was Australia's leading brewer with seven of the top 10 beer brands, and buying the company was consistent with its strategy to spread globally. It considers Australia an attractive market because of its population growth and economic connections to Asia.
SABMiller, which is listed in London and Johannesburg, said it had a proven track record of integrating brewing companies and improving the performance of those businesses.
SABMiller said it had decided to make the offer to the shareholders directly as Foster's board showed "no willingness" engaging with the offer.
SABMiller shares were up 0.5 percent at 21.29 pounds ($34.88) Wednesday morning.