Foster's Group, Australia's biggest brewer, is on the top of a $45.6 billion list of local companies compiled by broking house RBS Equities that are seen as targets especially for foreign buyout firms.The Melbourne-based company, which has a market capitalisation of $12 billion, last week knocked back a bid worth A$2.7 billion for its Treasury Wine Estates unit from an unidentified buyout firm.
Shares of the brewing giant climbed 9 to $6.21 yesterday and are up more than 20 per cent since chief executive Ian Johnston publicised plans in May to divide Foster's into separate listed beer and wine businesses.
According to analysts at Bank of America Corp.'s Merrill Lynch unit, the group may attract bids for its wine business worth A$3.5 billion ($3.3 billion)."Anyone considering buying an Australian wine asset today would be, in the highest of probabilities, buying that asset at the absolute bottom of the cycle," Merrill Lynch said.
"In four years ... asset prices would be higher than they would be today."
The list compiled by RBS Equities includes almost 30 companies. Many of these have become attractive takeover targets because of global shortages in food and energy.
"We believe acquisitions are more likely to occur in sectors delivering product that the world is structurally short (of)," according to RBS analyst Gregg Goodsell.
Corporate Australia was well-placed to grow over the next six to 18 months as the market entered a new mergers and acquisition cycle, he said.
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