Australian company Foster's Group - the brewery behind the eponymous lager - has rejected a AU$11.2 billion bid (£7.3 billion) bid from FTSE 100 brewer SABMiller (SAB.L).

In a market announcement, the group stated that the unsolicited approach 'significantly undervalues' the company.

The offer, which represents a proposed deal worth AU$4.90 per share, is said to be part of SABMiller's global strategy.
 
Foster's owns seven of the top ten beer brands in Australia, according to SABMiller, and is well placed to take advantage of demographic trends and growth in Asia.

According to SABMiller, the offer represents a valuation multiple of 12.5 times earnings.
 
Graham Mackay, chief executive of SABMiller, said the company had a track record of acquiring and integrating brewing companies. He called on the board to recommend the deal to shareholders.

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