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Thursday, 10 May, 2001, 05:46 GMT 06:46 UK
Foster's 'not aware' of Heineken bid
Beer being served in a pub
Foster's is the UK's number two beer with 8.2% of the market
Australia's Foster's Brewing Group has dismissed a report that it is in talks about being taken over by Dutch beer giant Heineken.

The Australian newspaper had reported the two were discussing a friendly deal that might be valued at up to 15bn Australian dollars ($8bn; 5.5bn).

The report sent Foster's share price up 6% and helped push the Australian dollar to two-month highs.

Foster's later released a statement to the Australian Stock Exchange in which it said: "We can confirm that Foster's Brewing Group is not aware of any potential takeover offer by Heineken."

A Heineken spokesman said the company did not comment on market rumours.

Unconvinced

The report comes four months after strong rumours circulated in the market about a potential $6bn takeover of Foster's by the UK-based drinks giant Diageo.

On Thursday, analysts remained unconvinced that Foster's would remain independent.

"It's made everybody realise that Australian companies still look cheap to overseas buyers," said Richard Newton, head of institutional sales at brokerage Burdett, Buckeridge & Young.

Foster's is best known for its lager beer brand but also has major wine operations, which also make it attractive to potential buyers.

Its beer is brewed in the UK and continental Europe under licence by Scottish & Newcastle.

Foster's is the UK's number two beer brand with more than 1bn in sales a year and 8.2% of the market.

It has about 55% of the Australian beer market.

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