Foster's buys BCB, a maker of RTDs - Brief Article

Modern Brewery Age, May 13, 2002

Foster's Group, the Australian beer, wine and leisure company, said last week its Carlton & United Breweries subsidiary has purchased a 65 percent stake in BCB Beverages Australia Pty. Ltd. for $7.2 million, including debt.

BCB Beverages specializes in the manufacture and packaging of premixed spirit drinks, known as ready to drink, or RTDS, as well as carbonated soft drinks.

CUB will use the facility to manufacture its core RTD brands including Cougar Bourbon and The Black Douglas Scotch.

Foster's Chief Executive Ted Kunkel recently said the company will make acquisitions in the RTD segment because it is a high-growth part of the beverages market.

Foster's said the BCB Beverages transaction will further strengthen CUB's spirits arm, The Continental Spirits Co., and is expected to be earnings a share "enhancing" immediately, delivering a premium over the group's cost of capital.

"The purchase of this production facility further positions CUB to maximize on the growth opportunity in RTDs, which is currently the fastest growing alcohol sector in Australia," said CUB Managing Director James King.

"The facility gives CUB the flexibility and competitiveness to respond to ever-changing consumer preferences for RTD products, which can be leveraged through the combined distribution systems of CUB, Continental Spirits and BCB, providing access to more than 90 percent of Australia's liquor retailers," King said.

BCB Beverages is located in outer suburban Melbourne.

Foster's said existing BCB Beverages management holds the remaining 35 percent of the business, which will be acquired by CUB in three years as part of a management [INCOMPLETE]