Foster's to keep wine business

Written by Nigel Huddleston

Tuesday, 17 February 2009

Foster's has decided to hang on to its wine businesses after a review of its operations.

There had been speculation that the Aussie giant would sell-off its wine brands – which include Lindemans and Penfolds, but the global recession has persuaded the company to hang on because it would be difficult to find a buyer.

Instead, Foster's is to sell-off its non-core vineyards and rationalise its tail Australian brands.

The move is expected to deliver around A$100 million a year in cost savings.

The Australian wine and beer sides of the business are to be separated to provide more management focus, organisational simplicity and financial transparency.

New managing directors for the Australian and Americas wine businesses will be appointed soon, but Peter Jackson will continue as the overall head of wine operations.

In all, 36 vineyards will be sold and three wineries closed.