Moody's affirms SABMiller

Moody's Investors Service said it affirmed the Baa1 long-term senior unsecured rating and prime-2 short-term rating assigned to SABMiller plc following news that it agreed with Foster's Group Ltd. on a recommended offer to buy all of the shares of Foster's at A$5.10 per share or about A$11.5 billion.

The outlook remains stable.

The proposed transaction has been recommended by the Foster's board to the group's shareholders and is expected to close by the end of 2011, Moody's said.

While the agency said it believes the deal stands a good chance of success, the agency cautioned that several steps still need to be completed. These include getting the necessary approvals from Foster's shareholders and from Australian authorities.

The proposed transaction would enhance SABMiller's business profile because it would rebalance its earnings base towards the more stable Australian beer market and give the company access to a highly profitable business and a solid share of the Australian market, Moody's said.

But challenges include the low volume growth characteristics of the Australian beer market, the agency said, and the commercial and market share headwinds that Foster's has faced in the recent past.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.