By Ian Neubauer
A takeover or break-up of Foster’s wine and beer businesses is unlikely in the short-term because of declines across multiple liquor categories, according to the Macquarie Group.
“Foster’s core business has continued its woeful performance in the Australian liquor market as shown by its volume and value decline across all liquor segments,” Macquarie Group analyst, Andrew Kovacs, told The Sydney Morning Herald.
“The weak operational performance highlights this is a risky option, with acquirers, at least for the wine business, very difficult to identify.”
Foster’s has been in a state of flux since last month’s shock resignation of CEO Trevor O’Hoy and a review of its continually under-performing global wine business.
Foster’s shares have been on a downward run since O’Hoy dropped the bomb, sliding from $5.57 on June 10 to $4.88 on Friday.
Speculation about a possible takeover by a consortium including Coca-Cola Amatil and SABMiller along with the appointment of banking heavyweight Michael Ullmer to Foster’s board nudged shares up by 5 per cent last week.
But gains were forfeited following a respective 2 and 3 per cent slump on the first and second day of trading the new financial year.
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