UPDATE 1-CC Amatil: SABMiller key to beer plan, not Foster's

SYDNEY, May 22 - Coca-Cola Amatil Ltd <CCL.AX>, Australia's top soft-drink bottler, played down talk of a merger with brewer Foster's Group Ltd <FGL.AX> on Friday, amid speculation of further consolidation in the Australian beverage industry.

The high-margin Australian market has attracted Japanese firms such as Asahi Breweries <2502.T> and Kirin Holdings <2503.T>, which earlier this month agreed to buy No. 2 brewer Lion Nathan Ltd <LNN.AX> for $2.5 billion.

Lion had dropped a planned $4.9 billion takeover of Amatil earlier this year.

"The logic of beer and soft drink together is very strong," Amatil Chief Executive Terry Davis said when asked about speculation of potential merger between Amatil and Foster's. But he said there was no value in it for Amatil at the price of about A$5.00 at which Foster's was trading in August 2008.

"I would say the same thing today," adding that Amatil would pursue an organic growth strategic with its partner SABMiller plc <SAB.L>, to build a bigger presence in the Australian beer market.

Davis was speaking to reporters after the company's annual shareholders meeting.

Amatil has a joint venture with brewing giant SABMiller to sell some of SABMiller's premium beer brands such as Peroni.

Earlier, Amatil said it expects to generate first-half pre-tax profit growth in the high single digits. [ID:nSYU006572].

Its shares rose 1.9 percent to A$8.65, against a 1 percent fall in the benchmark S&P/ASX 200 index <.AXJO>. ($1=A$1.28)