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New Zealand billionaire Graeme Hart has been linked to a possible bid for Australia's largest alcoholic drinks company, Foster's Group.
Foster's today issued a statement that it was unaware of any reason for recent moves in its share price amid speculation it could become the next target of private equity funds or the New Zealand deal maker.
It made the comments in a statement following a query on its share price move by the Australian Stock Exchange.
Foster's shares jumped 4.1 per cent to a record A$6.80 yesterday on renewed speculation of a takeover, this time by private equity.
Takeover speculation has followed the brewer for several months, with Belgium's InBev, the world's largest brewer by volume, and second-ranked SABMiller thought to be other potential suitors.
The Sydney Morning Herald reported today that Mr Hart was believed to have looked over Foster's.
Foster's, whose wine business is the world's second-largest after Constellation Brands Inc and includes the Wolf Blass and Lindemans brands, is valued at around A$14 billion and would be a big gulp, even for Mr Hart.
In August, Foster's said net profit for the year ended June 30 rose 15 per cent to A$623.1 million.
Last month, it said it remained confident of hitting its targets for double-digit earnings per share growth in 2007 despite some increase in input costs.
One rumour doing the rounds was that InBev was preparing a A$7.50-a-share - all up, about A$15 billion - bid, the Herald reported.
Foster's shares have now risen more than 25 per cent since it was reported in late September the Belgian brewer InBev and the ambitious South African brewer SABMiller were casting an eye over Foster's.
Foster's declined to comment on the speculation.
The surge in Foster's shares is due also in part to the frenzy of merger activity in Australasia that has affected Australian majors such as Qantas.
Foster's is seen as vulnerable following its ill-timed expansion of wine assets with the acquisition of Southcorp last year, as a wine glut became apparent.
Last week, Mr Hart completed the takeover of Burns Philp, which has left him with a war chest of up to A$3 billion.
That followed his purchase earlier this year, through vehicle Rank of New Zealand, forest products company Carter Holt Harvey for $3.3 billion.
Mr Hart said Australasia and North America remained the focus for Rank.
He said at the final Burns Philp AGM last week it was harder to find a bargain because private equity firms were bidding up the price of assets.
"You just need to be patient because markets will move in cycles - cycles haven't come to an end."
He is also said to be sizing up Australian packaging giant Amcor.
Mr Hart is also understood to be close to acquiring Trevor Farmer's Auckland-based building, joinery and cabinet-making supply business Exotic Timber Supplies, The National Business Review reported today.
He also recently bought nine ITM building supplies stores to bolster the Carters chain, part of Carter Holt Harvey.
Exotic has four branches in Auckland and one in Hamilton, and has been in business for more than 30 years.
Mr Farmer, whose Tappenden Holdings holds 90 per cent of the Exotic shares, refused to comment on the deal.
- NZPA
