Bloomberg Anywhere Remote Login Bloomberg Terminal Demo Request


Connecting decision makers to a dynamic network of information, people and ideas, Bloomberg quickly and accurately delivers business and financial information, news and insight around the world.


Financial Products

Enterprise Products


Customer Support

  • Americas

    +1 212 318 2000

  • Europe, Middle East, & Africa

    +44 20 7330 7500

  • Asia Pacific

    +65 6212 1000


Industry Products

Media Services

Follow Us

Modelo Said to Seek Board, AB InBev Support for Foster’s Bid

Foster's beer
Grupo Modelo SAB de CV, the Mexican brewer of Corona beer, and Molson Coors Brewing Co. have been exploring a possible joint bid for Australia’s Foster’s Group Ltd., said five people with knowledge of the situation. Photographer: Dmitry Beliakov/Bloomberg News

Grupo Modelo SAB de CV, the Mexican brewer of Corona beer, will seek board support for a possible joint bid with Molson Coors Brewing Co. for Foster’s Group Ltd. at a June 13 meeting in Mexico City, according to people with knowledge of the situation.

Such a proposal would need the backing of Anheuser-Busch InBev NV, which has nine seats on Modelo’s 19-person board and holds a 50 percent non-controlling stake. An offer would have to be at least $9 billion, or more than Foster’s current market value, said the people, who declined to be identified because the talks are private.

AB InBev is likely to tell Modelo at the meeting whether it will officially support or oppose a bid, said the people. The companies have discussed the idea, and AB InBev has raised concerns, including how the two companies would work together to manage a business based in Australia, one of the people said.

Jennifer Shelley, a spokeswoman for Modelo, declined to comment. Colin Wheeler, a spokesman for Denver-based Molson Coors, and Marianne Amssoms, a spokeswoman for Anheuser-Busch InBev, also declined to comment.

Molson Coors remains interested in pursuing a joint bid for Foster’s, said one of the people. If a joint Modelo-Molson Coors bid falls apart or is thwarted by AB InBev, then Modelo and Molson Coors could also pursue a bid on their own or with other partners, people said this month.

Modelo fell 1.57 pesos, or 2.2 percent, to 71.02 pesos in Mexico City trading as of 4:10 p.m. New York time. Molson Coors fell 52 cents to $44.22 in New York Stock Exchange composite trading.

Financing the Deal

The brewers are working with banks including Bank of America Corp. and Deutsche Bank AG on lining up financing for a potential purchase, said the people, who declined to be identified because the matter is private. Melbourne-based Foster’s has a market value of about A$8.8 billion ($9.3 billion).

Modelo is being advised by Bank of America and Greenhill & Co., and Molson Coors is working with Deutsche Bank, the people said. The Mexican brewer had about $2.27 billion of cash and cash equivalents at the end of March and no bank or bond debt.

AB InBev inherited its Modelo stake with the $52 billion purchase of Anheuser-Busch in 2008. Carlos Fernandez, chairman and chief executive of Modelo, sued to block the sale of the Modelo shares to AB InBev and lost in a ruling last year.

Fernandez has rejected selling control of Modelo to AB InBev and has said he’d be interested in buying back the stake. The company faces increased competition in Mexico after Fomento Economico Mexicano SAB sold its brewery to Heineken NV last year in a transaction valued at $7.35 billion.

Please upgrade your Browser

Your browser is out-of-date. Please download one of these excellent browsers:

Chrome, Firefox, Safari, Opera or Internet Explorer.