Foster's Beer Unit Not A Sweet Enough Deal For Japan-Centric Asahi

Japanese brewer Asahi Breweries' flat sales growth for FY2010 underlines the still-challenging operating conditions in its home market of Japan. A bleak outlook for the Japanese alcoholic drinks market has prompted Asahi to shift its focus onto overseas markets, and Carlton & United Breweries (CUB), the Australian beer arm of Foster's Group, was cited as an attractive acquisitional target for Asahi given CUB's strong exposure to the high-margin Australian beer market. However, Asahi President Naoki Izumiya recently quelled speculation that the company would bid for CUB, suggesting that CUB may not have been a sweet enough deal for Asahi due to the high acquisition cost and subdued outlook for the Australian beer market.

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