| Tue 21 Jun 2011, 8:00 | | SAB - SABMiller Plc - SABMiller Plc proposal to acquire Foster`s Group Limited |
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SAB
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SAB - SABMiller Plc - SABMiller Plc proposal to acquire Foster`s Group Limited
SABMiller plc
JSEALPHA CODE: SAB
ISSUER CODE: SOSAB
ISIN CODE: GB0004835483
21 June 2011
SABMiller plc proposal to acquire Foster`s Group Limited
SABMiller plc ("SABMiller") notes the announcement today by Foster`s Group
Limited ("Foster`s") and confirms that it has made a non-binding, conditional
proposal to the Board of Directors of Foster`s to acquire all of Foster`s shares
for A$4.90 per fully paid share in cash.
The proposal to acquire Foster`s is in line with SABMiller`s strategy to create
an attractive global spread of businesses, with a focus on developing strong and
successful brand portfolios. Australia has a strong, wealthy and growing
economy with consistent long term population growth in key demographics, and is
well positioned to benefit from continued economic growth in Asia. Australia
has a profitable beer market in which Foster`s is the leading brewer with 7 of
the top 10 beer brands, a national distribution platform and scale production.
SABMiller has a proven track record of integrating brewing companies and
improving the operating and financial performance of acquired businesses.
SABMiller would use its expertise, best operating practices, management
experience and global scale to enhance Foster`s leadership position, strengthen
and develop Foster`s brand portfolio and improve Foster`s operations and
profitability.
The SABMiller proposal was sent to the Chairman of Foster`s on 20 June 2011 with
the objective of reaching agreement on the implementation of a scheme of
arrangement. The proposal is subject to a number of conditions including
satisfactory due diligence, agreeing the terms and conditions of a scheme
implementation agreement and Foster`s board support.
SABMiller believes its proposal, which represents an enterprise value for
Foster`s of A$11.2 billion and a F11 forecast EV/EBITDA multiple of 12.5 times,
is attractive to Foster`s shareholders. The price represents a significant
premium of 14.5% to the trading price of Foster`s of A$4.28 as at 2 June 2011
(being the closing price prior to the most recent round of speculation of a bid
for the company) and with a significant premium of 18.4% to the adjusted closing
price of Foster`s shares as at 25 May 2010 of A$4.14 (being the adjusted last
closing price prior to the announcement of Foster`s intention to evaluate a
demerger).
The proposal consideration is all cash, providing certain value at closing for
Foster`s shareholders, and would be financed from SABMiller`s existing resources
and new debt facilities. SABMiller is in a position to conclude an agreed
transaction quickly.
As previously announced by Coca-Cola Amatil Limited to the Australian Securities
Exchange, SABMiller has separately reached agreement with Coca-Cola Amatil
Limited to acquire its share of the Pacific Beverages Pty Limited joint venture
should SABMiller acquire a controlling interest in Foster`s.
Commenting on the proposal, SABMiller Chief Executive Officer Mr. Graham Mackay
said:
"SABMiller has a proven track record of acquiring and integrating brewing
companies in a way which benefits shareholders, employees, business partners and
the broader community.
"We aim to strengthen the Foster`s brand portfolio and work with the local team
to bring our innovation, global scale and expertise to the business.
"We continue to believe that the proposal price is attractive and offers good
value to Foster`s shareholders. SABMiller can conclude a transaction quickly and
will continue to seek engagement with the Board of Foster`s to put an agreed
proposal to Foster`s shareholders."
Ends
Webcast and conference call
A live audio webcast of a presentation to investors hosted by Graham Mackay,
Chief Executive will begin at 9 am London time / 6 pm Sydney time on 21 June
2011.
To access the webcast or download a copy of the presentation, visit
www.sabmiller.com.
A listen-only conference call of the live webcast is available on Tel: +44 20
8515 2383 - access code: 4909#.
A conference call replay facility will be available one hour after the webcast
on Tel: +44 20 7154 2833 - conference ID 127191#
A webcast replay will be available on www.sabmiller.com
Supporting media materials
An interview with SABMiller Chief Executive, Graham Mackay, is available to view
and download at www.sabmiller.com/broadcastfootage
For a large selection of print quality images visit
www.sabmiller.com/imagelibrary
Enquiries
SABMiller Media Relations
Nigel Fairbrass / Beth Longcroft
Tel: +44 20 7659 0115 / Tel: +44 20 7659 0172
SABMiller Investor Relations
Gary Leibowitz / Henry Rudd
Tel: +44 20 7659 0119 / Tel: +44 20 7659 0154
Financial Dynamics - UK
John Waples: +44 7717 814 520
Jonathon Brill: +44 7836 622 683
Financial Dynamics - Australia
Jim Kelly: +61 412549083
Lauren Thompson: +61 438954729
Advisers
SABMiller has retained J.P. Morgan, Moelis & Company, RBS and Morgan Stanley as
financial advisers and Allen & Overy and Hogan Lovells International LLP as
legal advisers.
About SABMiller plc
SABMiller plc is one of the world`s largest brewers with brewing interests and
distribution agreements across six continents. The group`s wide portfolio
includes global brands such as Pilsner Urquell, Peroni Nastro Azzurro, Miller
Genuine Draft and Grolsch, as well as leading local brands such as Aguila,
Castle, Miller Lite, Snow and Tyskie. SABMiller plc is also one of the world`s
largest bottlers of Coca-Cola products.
In the year ended 31 March 2011, the group reported US$5,617 million adjusted
EBITDA and group revenue of US$28,311 million. SABMiller plc is listed on the
London and Johannesburg stock exchanges and has an American Depositary Receipt
programme sponsored by the Bank of New York Mellon.
About Foster`s
Foster`s is the leader in the Australian beer market with 30 June 2010 EBITDA of
A$948 million and net sales revenue of A$2,395 million. The company has a
portfolio of well established brands including VB, Carlton Draught, Corona,
Crown Lager, Pure Blonde, Carlton Mid and Carlton Dry. Foster`s is also the
largest cider producer in Australia. Foster`s is listed on the Australian
Securities Exchange.
1 Subject to adjustment for any dividends or distributions
2 Source: Foster`s Demerger Scheme Booklet
3 Assumes 1,942.8 million Foster`s shares based on the fully paid shares in
issue per Appendix 3B dated 10 May 2011 (1,940.9 million) plus maximum Long Term
Incentive Plan (LTIP) shares to be issued at 30 June 2010 as per Foster`s 2010
Annual Report (2.3 million), less the LTIP shares issued since 30 June 2010 per
appendix 3Bs (0.4 million) plus net debt of A$1.883bn less ATO receivable of
A$257m (Source: Foster`s Demerger Scheme Booklet) plus book value of minorities
of A$17m (Source: Foster`s December 2011 Half Year Results)
4 F11 EBITDA is calculated as the median F11 EBITDA forecast in the 8 brokers`
reports on Foster`s providing EBITDA forecasts which were published after 17
March 2011 (the date of release of the Foster`s Demerger Scheme Booklet) and
were available to SABMiller as at the date of this announcement. For three of
the broker sources used, SABMiller has adjusted the published EBITDA forecast to
include associate income (which was excluded in the EBITDA figures published in
those reports). The brokers` F11 EBITDA forecasts (adjusted as described above)
range from A$878 million to A$909 million with a median of A$896 million
5 Foster`s closing share price on 25 May 2010 of A$5.15 adjusted by a factor
of 0.804745 (Source: FactSet) to reflect the demerger of Treasury Wine Estates
Limited. Adjustment factor based on the opening price of Treasury Wine Estates
Limited on the first day of trading post demerger and the last closing price of
Foster`s pre-demerger
6 Defined as EBITDA before cash flows from exceptional items plus dividends
received from MillerCoors
Date: 21/06/2011 08:00:01 Produced by the JSE SENS Department.
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