UB to look at potential targets to offset probable Whyte & Mackay deal failure

The UB Group has initiated discussions with a clutch of smaller independent Scotch whisky distillers, in case the deal with Whyte & Mackay fails to materialize. Ian Macleod and Macduff International are some of the names that are being mentioned as possible acquisition targets.

UB is working on alternative strategies even as Whyte & Mackay chairman Vivian Imerman is expected to get back on UB’s estimated bid of around £470-480 mn in the next 10 days. Accordingly, UB is looking at buying 2-3 independent distillers with sizable Scotch malt bases valued in the £80-150 mn range. The other potential buyers for Whyte & Mackay are William Grant and Caribbean entity CL Financial who have valued Whyte & Mackay at £300-350 mn.

Read the article in The Economic Times.
Related Post: UB’s bid for Whyte & Mackay hit by price issues

UB’s bid for Whyte & Mackay hit by price issues

United Breweries’ bid for scotch whisky major Whyte & Mackay seems to be running into problems with the British company believed to have raised the price tag to £600 mn. The UB Group and Whyte & Mackay were holding negotiations during the past six months, but the two have failed to reach a conclusion due to differences over the valuations. The UB Group had offered a little over £400 mn; Whyte & Mackay did not agree to this price, which was later upped to around £500 mn.

Whyte & Mackay is the seventh-largest Scotch maker in Scotland with a turnover of $283 mn. It owns major brands like Isle of Jura, Dalmore, Vladivar Vodka and Whyte & Mackay.

Read more in the article in The Economic Times.

UB to acquire Whyte & Mackay for £500 mn

The United Breweries Group is close to acquiring Glasgow-based distillers Whyte & Mackay for nearly £500 mn (Rs. 4350 crores) by January-end. This will be the largest outbound acquisition by an Indian company.

United Spirits, a part of the group flagship United Breweries, might be the investment vehicle for the acquisition of Whyte & Mackay.

Citigroup advised Whyte & Mackay, while United Spirits was advised by UBS.

The acquisition follows United Breweries’ attempt to acquire Taittinger, the world’s sixth largest champagne company, for £400 mn.

Read more in the Business Standard article.

Brindco to buy 20% stake in wie maker Grover Vineyards

India’s largest wine importer Brindco is about to acquire 20% stake in premium domestic wine maker Grover Vineyards. Grover is a Bangalore-based company. The deal is estimated to be at an EV of Rs. 80-100 crores. Brindco will take over the marketing and distribution of the Grover Vineyard brands as well.

This is a second such investment in Grover, the first being made by Mphasis founder Jerry Rao to pick up 15% stake in the vintner. The deal with Brindco is considered to be strategic in nature as it unlocks the untapped distribution potential of Grover wines. Grover recently unveiled its economy-priced portfolio under the Sante range and is set to appoint a resident French wine maker, touted as a first in the domestic wine industry.

Brindco’s move into wine making is significant as it comes at a time when the tariffs on imported wine are poised to fall in the coming months. Sources said the Centre was expected to slash duties and remove countervailing levies on imported wines, which is likely to usher in a larger play in the country’s international wine business. Further, the domestic wine consumption (over 9 mn bottles annually), which is growing at 30% year-on-year, has seen the entry of the big players like the Vijay Mallya-led United Breweries Group and Seagram with their play expected to gather steam in the next 12-18 months.

Read The Economic Times article.

UB builds war chest of $500 mn-$1 bn for overseas acquisitions

United Breweries (UB) has allocated $500 mn to $1 bn for overseas acquisitions, an important part of its growth strategy, said UB Group President & CFO Mr. Ravi Nedungadi. Mr. Nedungadi said so in the post-meeting address to the media, on the occasion of group company Shaw Wallace’s 60th AGM.

Mr. Nedungadi’s remark is to be seen in the light of reports of UB trying to acquire Scottish firm Whyte & Mackay. Mr. Nedungadi neither confirmed nor denied developments with regards to this issue.

Read The Economic Times article for more details.

SABMiller may buy Mt Shivalik stake; EV seen at Rs. 300-350 crores

SABMiller Plc, the $14 bn beer giant, may buy a 50% stake or go for a complete buyout of Mt. Shivalik, the largest independent brewer in the country. The deal could carry an EV of Rs. 300-350 crores. Mt. Shivalik’s beer brand, Thunderbolt, has a 6% share of the growing domestic beer market. ABN-AMRO has the mandate from Mt. Shivalik to look for strategic options. Other global players like Carlsberg may also bid for the company.

Mt. Shivalik was recently offered $35-40 mn by Asia Pacific Breweries (APB), a Singapore-based arm of Heineken. Since then, its valuation has soared manifold. SABMiller had also placed a bid for majority stake in Mohan Meakins’ beer business after the promoter family invited business. However, the deal process has been in limbo for a while now. Earlier this year, SABMiller inked $120-million deal to buy the brand rights and beer assets of Foster’s in India giving it an additional 2% share of the domestic consumption.

With the acquisition of Mt. Shivalik, SABMiller can expect to see its market share jump to almost 44%, rather close to that of 45% of United Breweries. The Indian beer market has reported a growth of 25-30% in the current year.

More in The Economic Times article.