Foster’s brewery is to divide its beer business from its struggling wines unit in an attempt to make savings. Australia’s largest brewer is most widely known for its lager, though it is also the world’s second largest wine business after Constellation Brands. Foster’s has been in the wine market for fourteen years, having purchased Mildara Blass in 1996, and subsequently acquiring Lindemans and Penfolds .
Though its revenue from wine accounted for 40 per cent of total revenue in 2007, earnings have fallen heavily, prompting the company to announce the division of its wine and beer units – a demerger which is expected to be completed in the first half of 2011.
Fosters hopes to make A$100 million each year in savings as a result of the move, while investors seem confident that the move will enhance Foster’s performance, as shares rose 9 per cent on the announcement.
Meanwhile, it has been announced that Foster’s will sponsor this year’s Edinburgh Comedy Awards . David Jones, press and PR manager for Heineken UK – who own Fosters in the UK – commented that Fosters was the ideal sponsor for the event, owing to the brand’s sense of humour and its long association with comedy.
Fosters to Divide Beer and Wine Units
Thu, 27 May 2010
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