Lion Nathan, Australia’s second-largest brewer, has launched a US$4.9 billion bid for soft drinks group Coca-Cola Amatil, which is 30 percent-owned by the Atlanta-based soft-drink giant. The offer took the market by surprise. 
 
Like many other Coke affiliates around the world, Coca-Cola Amatil has been seen as a buyer, not a target, in this period of consolidation in the drinks business. It missed out on buying Frucor from Danone and is eyeing the Australian Schweppes business of Britain’s Cadbury. Coke itself bought a Chinese juice company in September.
 
Lion Nathan, which is 46 percent-owned by Japan’s Kirin Brewery, would end up with 60 percent of Australia’s soft drinks market if it buys Coca-Cola Amatil. Kirin said it would kick in US$2.4 billion in the form of a share purchase in Lion Nathan to help fund the deal. If Coke bring out the big guns, it’s hard to see how Kirin would be able to take on the top dog of pop. Kirin’s market cap is about a tenth of Coke’s US$104 billion. 
 
Investors seemed to sense the cash-and-stock bid might be a bit fizzy. The deal, pitched at a 25 percent premium to Coca-Cola Amatil’s share price, sent the target’s shares up to a record high. But the shares ultimately traded below the offer after Coca-Cola Amatil said the bid had material weaknesses and looked cheap compared with other recent transactions.
 
 
Deals of the day:
 
* China Banking Corp said it wants to buy the consumer banking arm of Philippine American Life and General Insurance Co (Philamlife), the local unit of American International Group and the country’s largest insurer.
 
* Three international insurers and an international bank are interested in acquiring a stake in the takaful unit of MNRB Holdings, the Malaysian Reserve reported. 
 
* Indonesian conglomerate Sinar Mas Group will acquire an up to 70 percent stake in PT Bank Century, the bank said.  

(PHOTO CREDIT: REUTERS/Will Burgess)