Takeover Panel Affirms Foster’s Financial Results
There is no solid ground to launch a deeper look on Foster's Group's financial report, according to a decision handed down on Thursday by the Takeover Panel, which rebuffed a plea by global beverage firm SABMiller to probe the Australian brewer's financial standing.
"There was no reasonable prospect that it would make a declaration of unacceptable circumstances in relation to (Foster's) Financial Objectives Statements." the panel said in determining that SABMiller has no case to begin with.
Pursuant to its takeover proposal for Foster's, SABMiller filed a request for the Takeover Panel to probe the target company's financial report, which the former claimed was fraught with misleading data.
Apart from Foster's sales projections that SABMiller said were anchored on questionable numbers and assertions, the UK-based brewer also claimed that Foster's pro forma net debt figure of $887 million was calculated employing accounting standards unacceptable in Australia.
The Takeover Panel, tasked by the federal government to arbitrate merger disputes in the country, however, saw it differently and concluded on it decision that SABMiller's plea is not backed by prima facie case that warrants a full-pledged probe.
Yet the panel ordered Foster's to release a clarifying note that would put to rest any questions on its net debt declarations, as raised in the earlier filing submitted by SABMiller.
In a statement, Foster's welcomed the Takeover Panel's decision, which it said cleared up any questions on its financial stature and proved that SABMiller, which forwarded a hostile $9.5 billion takeover bid for the local brewer, claims were "petty and frivolous."
"Foster's thought from the start SAB Miller's application was without foundation ... and the Takeovers Panel has not even commenced proceedings," the company said.
The decision, experts said, should douse further efforts by SABMiller to acquire ownership of Foster's at a value offering of $4.90, which the Australian firm said was far from its true market worth.
Market analysts are in agreement that Foster's shares could fetch higher offers from $5.20 to $5.60 and its current financial condition is backed by "mid single-digit sales growth projection," as the company asserted on its latest financial report.