SABMiller plc has entered into an agreement to acquire a 100 per cent interest in Fosters India for $120 million on a cash-free debt-free basis, subject to certain conditions being fulfilled. Under the terms of the agreement, SABMiller will assume ownership of all Fosters assets in the country, including the Fosters brand in the territory.
Fosters India currently operates one brewery based in Aurangabad with a licensed annual capacity of 350,000 hectolitres. The company produces, distributes and supports Fosters Lager, Amberro Mild and Amberro Strong beer brands in the Indian market. In the year ended June 30, 2006, total beer sales were 236,000 hectolitres with Fosters Lager representing 88 per cent of total production and sales.
SABMiller India will look to extend Fosters Lager nationally through its network of 10 breweries and seek significant cost benefits from brewing and distributing the brand locally. The Aurangabad brewery will also provide additional capacity for SABMillers presence in Maharashtra as well as a platform for access to the Mumbai market. SABMiller India is the subcontinents second largest brewer. Its brand portfolio includes Royal Challenge, Haywards 5000, Castle and the recently launched Haywards Black, Indias first stout beer.