Investec punts SABMiller despite Foster's bid
Fin24 - Jun 28th 2011, 12:08
London - Investec Securities recommended buying shares in SABMiller [JSE:SAB] on Tuesday as it became one of the first brokers to see the positive in its bid for Australian beermaker Foster’s Group.
Since SABMiller, the world’s No 2 brewer, launched its cash bid for Foster’s on June 21 - A$4.90 per Foster’s share, or a total of A$11.2bn ($11.7bn), including debt - shares in SABMiller, a predominantly emerging market brewer, have been on the slide.
“We are feeling a bit more upbeat on Foster’s than the rest of the market. In any case the risks are finite and the damage to SAB’s developing and emerging proposition can be overstated,” said analyst Martin Deboo at Investec.
Foster’s aside, Deboo say SABMiller’s valuation is looking compelling, with the London-based brewer expected to be the fastest-growing company by some margin among the 30 or so global consumer goods companies the broker covers.
“We are therefore resolved to swim against the short-term tide and are upgrading our recommendation on SABMiller to buy from hold and raise our 12-month target price to 2.475 pence from 2.360p,” he said.
SABMiller shares fell around 4% on the day of the Foster’s bid from 2.182p at the previous day’s close, but this week are starting to claw back some of the losses and were last up 0.7% at 2.173p in morning trade, in line with the London stock market.
SABMiller’s bid values Foster’s at 12.5 times forecast earnings before interest, tax, depreciation and amortisation. Investec says this compares to recent mature market deals such as Kirin’s bid for Australia’s No 2 brewer Lion Nathan at 13.1 times in 2009, and InBev’s bid for Anheuser-Busch to create the world’s biggest brewer AB InBev in 2008 at 13.8 times.
Distell waits for tribunal ruling
16/09/2019 - 10:03
Local alcoholic beverages company, Distell Limited, will have to wait for the Competition Tribunal’s decision whether or not global beer brewer Anheuser-Busch (AB) InBev and SABMiller plc (SAB) have breached their merger conditions by striking exclusive deals with outlets.
Distell and AB Inbev square off in booze showdown
13/09/2019 - 10:28
Exclusive branding arrangements with liquor outlets and agreements with sports stadiums took centre stage at Competition Tribunal hearings on Thursday, into Distell's accusation that Anheuser-Busch InBev (AB InBev) is contravening the conditions of its 2016 merger with SABMiller.
Consumers drink while retailers keep the tills active and lights on
10/09/2019 - 11:19
One in five South Africans is unemployed and economic growth remains anaemic, but retailers manage to grow, demonstrating that they still have some defensive qualities.
The SA liquor market is changing - these are the new favourites, says expert
21/08/2019 - 09:05
The way South Africans are consuming liquor is changing from traditional, heritage brands to modern, urban, "idiosyncratic" brands, according to Rowan Leibbrandt, founder of fine liquor merchants Truman & Orange.
#WomensMonth: The art of brewing with a woman’s touch
19/08/2019 - 13:36
SAB which boasts 57% of women brewers in South Africa, believes Women’s Month provides the perfect opportunity for our country to reflect on how far we have come in changing the perception of women and beer. Since prehistoric times, the important responsibility of brewing beer was almost always undertaken by women in a community, but since the industrial revolution in the 18th Century, it has become more of a male-dominated industry. Now is the time for women to take their power back and reassume their rightful place as society’s leading brewmasters.