News from just 1 hour ago. Fosters Group Ltd. has agreed to sell to SABMiller, a rival, for over $10 million;
According to Wall Street Journal:
The deal appears mainly to be about running Foster’s better and more efficiently by folding it into the global juggernaut that is SABMiller. Analysts have estimated that the combination could produce some A$150 million in cost savings a year.
Thats $5.53 a share of the Fosters stock.
All this boils down to is big beer buying big beer.
Via: NYTimes, Fosters has a full 50% of the market share of the beer industry in Australia. I think we knew that from the commercials. (joke.)
With an acquisition of Foster’s, SABMiller will gain exposure to market with high margins, albeit sluggish growth. Foster’s has a 50 percent share of the Australian industry, with 7 of the top 10 brands, including the No. 1 beer, Victoria Bitter.
Beer is awfully dramatic lately. Label lawsuits, name lawsuits, beer buying other beer, and the beer geeks lament. Fine. Well over a month ago, a rumor of the untimely demise of Brew Masters on Discovery Channel featuring Dogfish Head was circulated. I reached out to Discovery Channel, whom in turned called me back telling me that the show WAS NOT CANCELLED. They were merely taking a breath, checking direction, yadda, yadda, yadda.
Here’s today. A blog dubbed Beer & Whiskey Brothers stated it was cancelled, & maintained it was cancelled all along. One of the same blogs writers bumped into Sam from Dogfish and asked the question – what’s up with Brew Masters. Long story short, basically done he replied.
Ok. Here’s where it gets hairy. Discovery states low viewership. However there is something more complicated at work here. Money. Big Money. We all saw the Blue Moon commericals during the first Brew Masters show. Of course, that’s not considered “craft beer.” Beer geeks came out in droves on Beer Advocate forums complaining and questioning why the commercial was placed there. Sam of Dogfish Head even responded saying that the commercial annoyed him too.
Wrapping up the the issue, it seems like SAB Miller is a huge advertiser with Discovery. It’s either the millions of dollars in advertising and the commericals stay, or Brew Masters. Money wins. Drinking isn’t easy. Read the whole story <Beer & Whiskey Brothers>