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Philippine Food Company Bids to Buy Australian Dairy Company


Southeast Asian food and beverage giant San Miguel Corporation has initiated a takeover bid for one of Australia's largest food companies, while South Korea's government plans to spend more to boost economic growth.

The Manila-based San Miguel Corporation has offered $1.3 billion for a majority stake in Australia's National Foods. National Foods' board is asking shareholders to accept San Miguel's offer.

The price is 10 percent higher than an earlier bid from New Zealand food cooperative Fonterra - which already owns 19 percent of the Australian dairy company.

"This is a very good offer for the company and we believe there's a good strategic fit between the two organizations," said Ian Greenshields, a spokesman for National Foods.

Analysts are expecting a bidding war for National Foods. Fonterra earlier refused to rule out raising its bid.

San Miguel is best known for its regional beer business, but it has diversified business interests, including soft drinks, fresh and canned foods, agribusiness and packaging. Early last year, it bought a majority stake in an Australian fruit-juice company.

An air-services agreement signed by the governments of Singapore, Thailand and Brunei will give air passengers a greater choice of flights. The agreement allows local airlines to operate an unlimited number of services on any routes between the three neighboring countries.

More governments are expected to join the arrangement in the next few years as Southeast Asia aims to fully liberalize air services by 2008.

South Korea says it will increase public spending by 14 percent early this year to help boost the slowing economy.

The government expects consumer spending to remain weak and investments to fall this year, and is allocating $96 billion, or 60 percent of its budget, in the first half of 2005 to create jobs.

For 2004, officials estimate South Korea's export-driven economy grew only 4.7 percent. But there are positive signs. November industrial output rose 10 percent from the previous year, pushed by higher car and semiconductor exports.

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