Foster's: Australian for Acquisition Speculation

Foster's Group, an Australian-based brewer, is famous for its marketing catchphrase: "Foster's: Australian for beer." Lately though, the company's executive staff has had to deal more with a potential buyer than marketing, a source told Reuters. Speculation has grown that Molson Coors Brewing Company TAP and Grupo Modelo SA de CV GMODELOC will make a joint $9.5 billion bid for Foster's. Foster's Group Limited is engaged in the production and marketing of alcoholic beverages, including beer and wine. The company announced last year plans to spin-off or sell its wine unit. According to a Reuters report, "Foster's has been the subject of takeover talk since it announced plans last year to spin-off its struggling wine operations, which was seen as a deterrent to potential suitors." Foster's has a current market capitalization of $8.6 billion. In addition to beer and wine, it produces cider brands like Strongbow and spirits brands like Cougar and The Black Douglas. A source told Reuters that Bank of America BAC and Deutsche Bank DB are assisting Molson in the transaction. Shares of Foster's jumped 3.5% on the rumor, closing at $4.43.