While announcing that it has sold the Foster's brand in Europe to Scottish & Newcastle (S&N) for AU$750 million, the Australian brewing giant has revealed that it is to end its global sponsorship of Formula One.

In a statement issued by Foster's today, Foster's Brewing International Managing Director, Richard Scully, said: As part of a program to significantly reduce overheads within the Foster's Brewing International business, Foster's Group will not be renewing its sponsorship of Formula One at the end of the current season when its contractual obligations expire (December 2006).

"This sponsorship has been important for Foster's, raising consumer awareness of the brand globally. While Foster's Group will continue to co-ordinate global marketing initiatives, decisions about sponsorship will rightly rest with our co-brand owners and regional partners."

Having been involved in Formula One for twenty years, the Australian beer has title sponsorship of a number of races, most notably the Melbourne and Silverstone events. It is the 'official beer' of F1 and enjoys exclusive 'pouring rights' at many tracks.

Although S&N has not yet announced its plans, it is highly unlikely that it will continue the association with F1 since, under the code of the Portman Group, set up in 1989 by the UK's leading drinks producers, it is believed that F1 is not a fitting promotional tool for the drinks industry. That said Diageo, manufacturer of Johnnie Walker, sponsors McLaren.

Under the terms of today's deal all Foster's global sponsorship deals are in doubt, so it is not known how this will affect sponsorship of the Australian A1 GP team.