Sluggish Foster's Financial Showing May Impact Bargaining Position With SABMiller

Sluggish full-year financial results of Australian alcoholic drinks producer Foster's Group may have weakened its bargaining position with UK brewer SABMiller. Foster's has previously rejected SABMiller's takeover offer twice on grounds that the offer undervalued the company. Given that SABMiller could struggle to generate additional cost savings to justify a higher valuation, we maintain our view that SABMiller is unlikely to put forward a significantly higher bid to land Foster's.

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