Financial Daily from THE HINDU group of publications
Sunday, Feb 24, 2002
Financial Daily from THE HINDU group of publications Sunday, Feb 24, 2002 |
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Mergers & Acquisitions Corporate - Mergers & Acquisitions UB to take SAB by the horns on Rochees bid Boby Kurian
BANGALORE, Feb. 23 UNITED Breweries (UB) is hurtling for a head-on collision with global giant South African Breweries (SAB). In a hostile move, the domestic beer major is in talks to steal the acquisition of Rajasthan-based Rochees Breweries Ltd from the multinational. Speaking to Business Line, Mr Ravi Nedungadi, President & CFO, UB group, said Rochees figured among the three breweries short-listed by the company for possible acquisition in Rajasthan. "We didn't go to Rochees. The promoters came to us looking for a deal. The brewery is still on the table," he said. It is learnt that Rochees' promoters were miffed as SAB was yet to complete financial transaction of the acquisition, which it effected last November. SAB had entered into an agreement to buy 53 per cent stake in Rochees, listed on the Bombay Stock Exchange, and subsequently announced an open offer to the public shareholders. When contacted, SAB India Ltd's spokesperson said UB's move was nothing but a "war of nerves". He said SAB did not disburse transaction cash as it was waiting for approval from the Foreign Investment Promotion Board and the Securities and Exchange Board of India. "There is no other problem. We have the sale of share agreement and intend to do business straight and transparent," the spokesperson added. It must be mentioned that UB has had a contract brewing arrangement with Rochees before SAB entered the fray. UB advanced a loan of Rs 3.5 crore to Rochees, which in turn pledged 20 per cent stake as security with the domestic major. SAB claims it moved ahead with acquisition only after receiving a formal letter from UB, indicating return of the pledged security. Meanwhile, UB sources said the company entered into the fray after learning that SAB was not serious in pursuing the takeover.
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