Foster’s unifies its brands

Foster’s streamlines its global business into three regional operations

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By  Lynne Nolan Published  August 1, 2006

Foster’s has streamlined its global business into three regional operations and has ditched its separate wine and beer divisions, in an effort to bolster brand recognition. Now divided into three areas — including the Middle East and Africa — the group hopes the move to become one brand for all of its products will benefit its multi-beverage strategy. As a result of the move, which took effect on August 1, the group will trade as Foster’s in every market, and will no longer refer to its businesses as Foster’s Wine Estates or Foster’s Australia, for example. “With the integration of Southcorp now largely complete, and after two years of significant transformation we are fundamentally a different company. We are now an international drinks business with a broad portfolio of brands,” announced Trevor O’Hoy, CEO, Foster’s. The company was previously divided into four operating divisions — Foster’s Australia, Foster’s Wine Estates, Foster’s Brewing International and Global Wine Clubs and Services – offering beer, wine, spirits, ready-to-drink ranges, cider and non-alcoholic brands. The restructure comes just one year after Foster's revamped its organisation, following its US $3.2 billion acquisition of winemaker Southcorp in May 2005. Each regional division will draw upon the support of a global supply chain team and a global marketing and consumer insights team. Global support functions will comprise finance, strategy, human resources and legal. Based in Melbourne, Australia, Fosters employs more than 9000 people and its products are sold in 155 countries. With a portfolio of market-leading brands including Victoria Bitter, Beringer, Lindemans, Wolf Blass, Carlton Draught, Penfolds and The Black Douglas, its flagship beer brand, Foster’s Lager, is ranked in the top 10 of international beer brands. “Our multi-beverage business is gaining momentum. We have made substantial headway with our plans to realise greater value from the Foster’s beer brand and our multi-region, premium wine portfolio,” O’Hoy said. O’Hoy also added that the company had minimised its non-core businesses and assets in an effort to focus on its premium drinks ranges. Planning to sell wineries in France and Australia, it recently agreed to sell its Shanghai brewing business and local Chinese beer brands to Suntory. In April, Foster's sold the licensing rights for Foster's in Europe, to Scottish and Newcastle. The company hopes that the new structure will position itself closer to its customers and consumers, while reinforcing its philosophy of working as one team. “We are now sharing our capabilities and infrastructure across products, processes and regions,” O’Hoy added.

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