By Andrew Starke
Investors have been quick to conclude that two heads are better than one as Treasury Wine Estates (TWE) yesterday began life as a standalone company on the Australian Securities Exchange (ASX).
Initial trading was mixed for Treasury and Foster’s with the former first changing hands at $3.21 and ending the day at $3.36 while the latter without its wine business dropped 95 cents to $4.53.
Analysts were generally positive on the opening day’s trading, which appears to have justified the demerger, and was less volatile than predicted.
Speaking to reporters yesterday, Treasury CEO David Dearie was upbeat on the new start the company had been given while down-playing the importance of share price in the short-term.
However, as head of the world’s largest wine company, Dearie is aware that shareholders, analysts and potential suitors will be watching his management team’s every move with interest.
“I’m excited about leading Treasury Wine Estates,” he said. “We have an outstanding global portfolio of wine brands that are admired and respected by customers and consumers the world over.
“We have a team of dedicated ‘Vintrepreneurs’ in many key markets who drive our sales and connect us with the shopper, along with viticulturalists, winemakers and supply staff who manage our efficient production model.
“Add this to a wine category in growth and we’ve got a great opportunity.”
Treasury brands include Lindemans, Penfolds, Rosemount, Wolf Blass and Beringer,
Under the demerger scheme, Foster’s shareholders were issued one share in Treasury Wine Estates for every three Foster’s shares they held.
Treasury shares commenced trading on a deferred settlement basis yesterday with normal trading expected to commence on May 24, 2011.
“As a standalone business Treasury Wine Estates will benefit from enhanced strategic and management focus and enjoy greater operational and decision-making flexibility,” said Treasury Wine Estates Chairman Max Ould.
“The performance of the business continues to improve, and this, together with low debt and strong cash flows, position the Company well to grow value for shareholders in the future.”
TWE also unveiled a new website, which can be viewed by clicking here.