Foster's to demerge beer and wine
May 26, 2010 |09:33 | Wine Information | Wine Types By : Team X
Foster's plan to split its struggling wine business from its well performing beer unit, likely to be completed in the first half of 2011, would yield about A$100 million in annual savings from 2011 and give it much needed flexibility, the firm said.

The wine business, facing oversupply and weak demand, has weighed on Foster's and the company will take a non-cash after-tax impairment charge of A$1.05-1.2 billion in fiscal 2010 on wine assets, possibly forcing a delay in dividends. "Foster's has been touted as takeover target for a while but wasn't touched so far because of its wine business. Now the separation clears that," Chris Weston an institutional dealer at IG Markets said.


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