Australia's Foster's delays wine unit decision

 Foster's Group Ltd , the world's second-largest wine group, has delayed a decision on the fate of its troubled wine business until early 2009 while it examines opportunities, it said on Wednesday.

The brewer began a review of the business, whose brands include Rosemount and Penfolds and which is worth about A$5 billion ($3.2 billion), earlier this year after sliding sales dragged down overall profit. The result of the review had been expected before the end of 2008.

"However, we have taken the decision to extend our workplan into early next year and now expect an announcement of the review outcomes no later than the release of our first-half trading results in mid February," Chairman David Crawford told the annual meeting of shareholders.

"We are just looking at every opportunity that is available," he later told reporters after the meeting, adding that recent volatility in financial markets had also been taken into account.

Foster's, which doubled the size of its wine business when it bought Southcorp for A$3.7 billion in 2005, has acknowledged that it paid too much. It may list the wine business separately or sell off some brands or vineyards.

Crawford said Foster's had not yet received any meaningful proposals.

Deutsche Bank has accumulated a 5 percent stake in the group, heightening speculation that international brewers may be interested in Foster's, which has a 52 percent share of the beer market in Australia. Crawford said that he did not know who was behind the Deutsche Bank stake.

Foster's also said its performance in the quarter to September was in line with its expectations.

"As we look forward to our half year results I am certainly encouraged by some of our performance trends," Chief Executive Ian Johnston told shareholders.

Johnston said global wine results would reflect the impact of the higher cost of goods, but added that recent movements in Australian dollar exchange rates were a positive.

Analysts expect Foster's to report a 3.4 percent increase in 2009 financial year net profit to A$735 million, according to Reuters Estimates.

Foster's shares have fallen 22 percent so far this year better than a 32 percent slide in the broader market.