Without citing any source of information, the Australian Financial Review reports that the global market conditions, a lack of buyers and the prospect of a big loss of shareholder value were the reasons, why the brewer has decided to postpone its decision.
The daily further said the company might still spin off the unit to its own shareholders or sell lower-end wine brands and reposition the business as a seller of premium wines.
Australia's largest brewer is due to decide early next year on what to do with the wine unit, which ranks globally behind Constellation Brands Inc. It owns several famous brands including Rosemount and Penfolds.
The wine business, valued by analysts at around A$5 billion ($3.4 billion), has seen a fall in sales, dragging down overall group profit, says Reuters Sydney.
Last week, an American brewer, Coors Brewing had emerged as holder of a 5 percent interest in Foster's, sparking talk of a takeover bid.
The news is significant in India for another reason. Champagne Indage has postponed the closing of the South Australian Loxton Winery deal which was finally to be closed on October 31. With the tight financial conditions, Indage may not find it easy to raise the funds it plans to, or the cost of funds may be too high, with over 83% of the share value having being eroded.
It is fairly certain that the company would want to either back out of the deal or will renegotiate under the changed circumstances. In public statements, the company has maintained that it is putting the deal on hold and has every intention of closing. |